[Good Morning Market] US Stock Market Rebounds Led by Tech Stocks... KOSPI Expected to Start Up 0.5%

Overnight, the U.S. stock market closed higher, led mainly by technology stocks, amid generally favorable economic indicators. On the 28th, the domestic stock market is also expected to start with an increase of around 0.5%.

On the previous day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 33,926.74, up 212.03 points (0.63%) from the previous session. The Standard & Poor's (S&P) 500 index closed at 4,378.41, up 49.59 points (1.15%), and the Nasdaq index ended at 13,555.67, up 219.89 points (1.65%).

Despite concerns about a recession, U.S. economic indicators showed better-than-expected improvements. The Conference Board's Consumer Confidence Index for June recorded 109.7, surpassing last month's 102.5. It also marked the highest level in 17 months since January last year. This figure was higher than the market expectation of 104.0 compiled by The Wall Street Journal (WSJ).

As economic indicators improved, confidence in the economy increased, leading to a broad rebound in technology stocks that had recently been in a correction phase. Stocks such as Nvidia, Meta, and Tesla rose more than 3%. Apple and Amazon also closed up more than 1%. Roblox, which had shown a sluggish trend, demonstrated strength with a rise of over 6%.

Jerome Powell, Chair of the U.S. Federal Reserve (Fed) [Image source=Yonhap News]

The rise in the U.S. stock market, supported by solid economic indicators, is expected to have a positive impact on the Korean stock market as well. However, the fact that Jerome Powell, Chair of the U.S. Federal Reserve (Fed), Christine Lagarde, President of the European Central Bank (ECB), and Andrew Bailey, Governor of the Bank of England (BOE), are scheduled to attend and speak at the ECB Forum held in Portugal on the same day poses some downside risk. They are expected to deliver mainly hawkish remarks.

Seo Sang-young, Head of Media Content at Mirae Asset Securities, said, "Following the Chinese government's expression of willingness to stimulate the economy, the influx of confidence in the U.S. economy is expected to have a favorable effect on the Korean stock market, which is highly dependent on exports." However, he added, "Considering this, the Korean stock market is expected to start with an increase of around 0.5%, but some selling pressure is likely to be absorbed in the latter part of the trading session."