The New York stock market declined for the second consecutive day as military tensions in the Middle East escalated. With international oil prices rising for the sixth straight day, concerns about inflation and potential interest rate hikes by the U.S. Federal Reserve have intensified. On September 9, attention is focused on whether the domestic stock market will continue to face resistance near the 7,000 mark. However, analysts suggest that the recovery of semiconductor and artificial intelligence (AI) stocks indicates a low likelihood of disrupting the KOSPI's existing upward trend.
On September 8, the Dow Jones Industrial Average closed down 628.18 points (1.18%) at 52,786.07. The S&P 500 index fell 45.08 points (0.58%) to finish at 7,673.52, while the tech-heavy Nasdaq composite dropped 85.58 points (0.32%) to close at 26,421.41.
The U.S. stock market showed weakness amid growing geopolitical uncertainty stemming from the Middle East. Over the weekend, the U.S. and Iran exchanged ballistic missile attacks, followed by clashes between Saudi Arabia and Iran-aligned Houthi rebels, and reports of U.S. strikes on Iranian oil tankers, which dampened investor sentiment.
International oil prices continued to rise. West Texas Intermediate (WTI) crude for October delivery closed at $93.03 per barrel, up $1.55 (1.69%). Brent crude for November delivery rose $0.92 (0.95%) to $97.92 per barrel. Oil prices have increased for six consecutive days and have risen over 8% this month.
The rise in oil prices is fueling inflation concerns and increasing vigilance regarding potential interest rate hikes by the Federal Reserve. The yield on the U.S. 10-year Treasury note remained steady at 4.79%. Gold prices fell 0.4% to $4,385.09 per ounce as inflation fears and the possibility of rate hikes came to the forefront.
Major tech stocks generally showed weakness. Nvidia fell 2.01%, while Microsoft and Apple dropped 1.15% and 1.17%, respectively. In contrast, Tesla rose 3.98%, and SpaceX increased by 3.73%. In the semiconductor sector, Intel surged over 9% on news of CPU price increases and optimism surrounding AI.
Despite the weakness in the U.S. stock market and uncertainty from the Middle East, the domestic market is expected to show resilience near the 7,000 mark, supported by the relative strength of the semiconductor sector.
As of 8:32 a.m. on September 9, Samsung Electronics was up 0.3%, and SK Hynix rose 1.0% in pre-market trading. SK Square and Hyundai Motor also showed gains of 0.6% and 0.2%, respectively.
Market analysts believe that while volatility is inevitable due to recent geopolitical instability in the Middle East and rising oil prices, the likelihood of disrupting the KOSPI's recovery path remains low. They note that the recovery of semiconductor and AI stocks, along with maintained profit estimates for the KOSPI, suggests that resistance near the 7,000 mark should be viewed as a consolidation phase rather than a trend reversal.
Han Ji-young, a researcher at Kiwoom Securities, stated, "The U.S. stock market has recorded two consecutive days of weakness due to escalating uncertainties from the Middle East, including attacks on Saudi energy facilities and Iranian oil tankers near the Hargh Island. However, the recovery of leadership in domestic and international semiconductor stocks, driven by Nvidia and Broadcom's performance and the anticipated launch of OpenAI's GPT-6, is a positive sign."
He added, "The rise in WTI prices to the mid-$90 range and upward pressure on the U.S. 10-year yield are creating a loop of rising oil prices leading to increased inflation concerns, which in turn heightens vigilance regarding the August Consumer Price Index (CPI) and potential rate hikes at the September FOMC meeting. However, compared to past military conflicts between the U.S. and Iran and the 10-year yield entering the 4.8% range, the pressure for a market correction appears limited, indicating increased resilience to macroeconomic and geopolitical variables."
Another analyst noted, "Today, the domestic market is likely to show a cautious stance despite a 1% gain in the Philadelphia Semiconductor Index, as the renewed U.S.-Iran conflict and heightened CPI vigilance create resistance. The recent failures to breach the 7,000 mark have led to this index level being perceived as a psychological resistance, but it is essential to approach the issue as a matter of timing rather than merely the level itself."
He further stated, "Foreign investors, who have turned to net buying in September, are absorbing a significant portion of the large sell-offs by individuals, along with institutions and other corporations, helping to defend the lower end of the index. Currently, the area around the 7,000 mark is more indicative of a transition phase where individual sell-offs are being absorbed by foreign and corporate buybacks rather than the upper limit of this recovery trend."
* This article has been translated by AI.
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