Concerns over the profitability of investments in global artificial intelligence (AI) companies and SK Group's withdrawal of its Solidigm IPO have led to continued fluctuations in the KOSPI index. This week, Samsung Electronics will hold its third-quarter earnings conference call, and SK Hynix will announce its third-quarter results. Analysts expect ongoing volatility due to macroeconomic challenges and the semiconductor sector's earnings week.
According to the securities industry on the 25th, the KOSPI faced significant volatility last week due to macroeconomic issues, including rising international oil prices following renewed Middle East conflicts, increased fiscal burdens leading to interest rate hikes, and global inflation concerns. The KOSPI closed at 5550.30 on the 23rd, down 117.75 points (2.08%) from the previous week. During the same period, the KOSDAQ fell by 43.09 points (5.42%). However, considering the previous week's decline of 14.46%, the recent drop has shown signs of stabilization.
On its first trading day on the 19th, the KOSPI opened up 1.76% but fell 3.73% on the 20th due to uncertainties surrounding AI investment sustainability. It rebounded with a 3.29% increase on the 21st, driven by strong performances from SpaceX and Supermicro. The index dropped again by 3.52% on the 22nd amid global uncertainties, but rose 0.30% on the 23rd after news that SK Group had halted its Solidigm IPO review, alleviating some semiconductor uncertainties.
This week, the stock market is expected to experience mixed trends due to both positive and negative factors. Notably, foreign selling has decreased, which is a positive sign. From October 19 to 23, foreign net selling amounted to 1.1021 trillion won, a 92.3% drop from the previous week's 13.2086 trillion won. However, the halt in buying from other corporations is a negative factor. Following Samsung Electronics, SK Hynix's share buyback ended on the 21st, resulting in a weekly net purchase of only 1.4024 trillion won from other corporations.
The domestic stock market is expected to focus on key events such as Israel's election on the 27th, the U.S. Federal Open Market Committee (FOMC) meeting, SK Hynix's earnings announcement on the 28th, and Samsung Electronics' conference call on the 29th to gauge market direction.
If neither the Likud party, which advocates for the overthrow of the Iranian regime, nor the Yashar party, which emphasizes exit strategies, secures a majority in the Israeli election, the likelihood of forming a coalition government increases, raising uncertainties. In the U.S., early voting is underway in key battleground states ahead of the November 3 midterm elections. Domestically, SK Hynix and Samsung Electronics will unveil their third-quarter results and new shareholder return policies on the 28th and 29th. Resolving uncertainties is expected to ease the supply-demand imbalance in the KOSPI and attract foreign buying.
A securities industry official stated, "This week, the possibility of the October FOMC holding interest rates steady and the Israeli election, which will determine the direction of the Iranian conflict, are expected to be key variables affecting international oil prices and global uncertainties. Given the ongoing uncertainties surrounding major corporate earnings announcements and macroeconomic challenges, the domestic market will continue to search for direction."
* This article has been translated by AI.
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