"Has US Inflation Peaked?" Market Cheers... KOSPI Also Rises Strongly

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Joselgina, Reporter Kwon Jaehee] The US inflation rate is showing signs of slowing down, prompting cheers in the market. While the three major indices of the New York Stock Exchange rallied, the KOSPI recovered above the 2500 mark. Observations that the soaring inflation may have peaked are spreading, seemingly reviving risk asset preference sentiment.

On the 10th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average, composed of blue-chip stocks, closed at 33,309.51, up 1.63% from the previous session. The large-cap-focused S&P 500 index rose 2.13%, and the tech-heavy Nasdaq index closed up 2.89%. All three major indices reached their highest levels since early May. Notably, the Nasdaq index escaped the bear market?defined as a 20% drop from its previous peak?after 107 days.

This followed the release of the July Consumer Price Index (CPI), which showed a greater-than-expected slowdown. The July CPI rose 8.5% year-on-year, significantly below June’s increase of 9.1%. The month-over-month CPI increase was 0%, indicating no change.

The domestic stock market also showed a strong performance. Around 10 a.m. on the 11th, the KOSPI rose more than 36 points, surpassing 2500 and quickly climbing to the high 2510s. All of the top 10 stocks by market capitalization, including the leading Samsung Electronics, rose.

The exchange rate remained stable as well. In the Seoul foreign exchange market that day, the won-dollar exchange rate started at 1,297.0 won per dollar, down 13.4 won from the previous trading day’s closing price, fluctuating between 1,297.0 and 1,300.8 won in the early session.