U.S. Rate Hike and Oil Price Surge Impact Korean Market Ahead of U.S.-China Summit

◆Aju Economic News Highlights
▷ U.S. rate hike and rising oil prices lead to a 0.23% drop in KOSPI
- The KOSPI closed down 0.23% at 6,894.23 last week, influenced by the U.S. interest rate hike, a surge in international oil prices, and the U.S. 10-year Treasury yield surpassing 5%. Concerns over the pace of AI development also contributed to market fluctuations.
- Foreign investors sold a net 8.871 trillion won in the stock market, while institutions bought 1.053 trillion won, helping to cushion the decline.
- This week, the upcoming U.S.-China summit on September 24 is expected to be a key factor, particularly regarding potential regulations on AI and semiconductors, which could impact major domestic players like Samsung Electronics and SK Hynix.
- The market is also facing pressure from supply shortages ahead of the Chuseok holiday. Historically, the KOSPI has averaged a -0.42% return in the five trading days before Chuseok, but has seen a 0.68% increase in the five days following the holiday.
- Analysts note that the KOSPI's 12-month forward price-to-earnings ratio remains at a historical low of around five times, suggesting that sectors like semiconductors, power equipment, and automobiles could present short-term adjustment opportunities.
 
◆Major Announcements After Market Close (September 18)
▷ Corpus Korea acquires 4 billion won worth of Episode Media shares
▷ CG Invites purchases 9.4 billion won worth of shares in affiliate VISTA, raising its stake to 43.7%
▷ Hanssem plans to buy back and retire 10 billion won of its own shares annually until 2028
▷ Alteogen receives sales approval in Japan for the ALT-B4 kit for Keytruda SC
 
◆Fund Trends (as of September 17, excluding ETFs)
Domestic equity funds: -10.4 billion won
Overseas equity funds: -56.5 billion won
 
◆Key Events for Today (Monday)
U.S.: Chicago Fed National Activity Index (August), ECOC 2026 (through September 24) featuring Oracle, NVIDIA, Lumentum, Coherent
China: LPR interest rate decision.