The KOSPI opened lower due to rising U.S. long-term interest rates, increasing international oil prices, and a weak performance in the New York stock market. Profit-taking from the previous day's surge of over 5% is also contributing to the decline, with foreign and institutional investors engaging in net selling. However, some large-cap stocks, such as SK Hynix and KB Financial, are showing gains, indicating sector differentiation.
As of 9:27 a.m. on the 21st, the KOSPI is trading at 6,784.73, down 67.85 points (0.99%) from the previous trading day. The index started at 6,759.95, down 92.63 points (1.35%), but has slightly reduced its losses.
Overnight, the New York stock market fell across the board due to a resurgence in U.S. long-term interest rates, a spike in international oil prices, and concerns over consumer slowdown following disappointing earnings from Walmart. On the New York Stock Exchange on the 20th (local time), the Dow Jones Industrial Average dropped 1.32%, while the S&P 500 and Nasdaq fell by 0.87% and 1.00%, respectively.
The yield on U.S. 10-year Treasury bonds rose to 4.70%, while the 30-year yield reached 5.24%. Long-term rates, which had stabilized following news of an expanded buyback of long-term Treasury bonds by the U.S. Treasury, are now rising again, raising concerns about structural upward pressure on rates due to fiscal deficits and increased Treasury supply.
International oil prices also increased amid heightened concerns over potential U.S. economic sanctions against Iran. Brent crude and West Texas Intermediate (WTI) rose by 2.36% and 2.33%, respectively. The rise in oil prices is raising inflationary pressures, which could impact the monetary policy of the U.S. Federal Reserve.
Concerns over a slowdown in U.S. consumer spending are also weighing on the market. Walmart's stock plummeted 9.15% after reporting a slowdown in same-store sales growth for the second quarter, amplifying fears of a consumer slowdown.
However, semiconductor stocks have fared relatively well. Micron announced a large-scale investment plan in artificial intelligence, leading to a 4% increase in its stock, and the Philadelphia Semiconductor Index is showing strength. In South Korea, SK Hynix is up 1.06%.
In the securities market, individual investors are net buying 365.6 billion won, while foreign and institutional investors are net selling 304.5 billion won and 149.5 billion won, respectively.
Among the top market capitalization stocks, Samsung Electronics (-0.09%), SK Square (-1.87%), Samsung Electro-Mechanics (-4.87%), Hyundai Motor (-1.20%), LG Energy Solution (-2.23%), Samsung Biologics (-1.33%), Samsung C&T (-0.80%), and Samsung Life Insurance (-1.01%) are all declining. Conversely, SK Hynix (1.06%) and KB Financial (0.56%) are on the rise.
At the same time, the KOSDAQ index is trading at 809.09, down 31.80 points (3.78%) from the previous trading day. The index started at 824.05, down 16.84 points (2.00%), and has since widened its losses.
In the KOSDAQ market, individual investors are net buying 239.8 billion won, while foreign and institutional investors are net selling 160.3 billion won and 75.8 billion won, respectively.
Among the top market capitalization stocks, most are in decline, including Alteogen (-5.30%), EcoPro (-5.11%), EcoPro BM (-5.43%), Rainbow Robotics (-5.94%), JUSUNG Engineering (-2.09%), Wonik IPS (-4.04%), HLB (-2.63%), Rino Technology (-4.60%), IOTech (-2.29%), and ABL Bio (-6.85%).
Market analysts are cautious about the potential for increased short-term volatility due to rising U.S. interest rates and oil prices, but they believe that the earnings outlook and low valuations in the domestic market will provide support against further declines.
Han Ji-young, a researcher at Kiwoom Securities, stated, "Today, the domestic market is starting lower due to the impact of rising U.S. market rates and Walmart's poor earnings, despite the strength of the Philadelphia Semiconductor Index with companies like Micron. The market will likely see sector differentiation based on foreign investor sentiment."
He added, "While macro uncertainties are high, the current earnings momentum of the KOSPI is reassuring. As of August 20, the consensus for KOSPI operating profit for 2026 and 2027 is 986 trillion won and 1,311 trillion won, respectively, showing no significant damage even after the pressures of rising rates and energy costs in August."
Another analyst noted, "With a forward price-to-earnings ratio (PER) of only 5.5, the valuation pressure from interest rates is not significant. Considering the increasing likelihood of shareholder returns from Samsung Electronics following SK Hynix, the pressure for stock price adjustments due to macro uncertainties is likely to be limited."
He concluded, "Even if additional market adjustments occur, a strategy of gradually buying large-cap stocks, including semiconductors, may be a better option."
* This article has been translated by AI.
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