[Good Morning Stock Market] US Stocks Rise on Alphabet and AMD Boost... "KOSPI Starts Up 0.6%"

Rising AI Stocks Lead Gains Ahead of Employment Report Release
Unemployment Figures Fall Short of Expert Forecasts

Image source=Yonhap News

The domestic stock market is expected to start higher on the 8th. The positive impact is likely due to the strong closing driven by Alphabet's unveiling of a new artificial intelligence (AI) language model and AMD's new product launch ahead of the employment report release.

On the 7th (local time), the Dow Jones Industrial Average closed at 36,117.38, up 62.95 points (0.17%) from the previous session. The S&P 500, focused on large-cap stocks, ended at 4,585.59, up 36.25 points (0.8%). The tech-heavy Nasdaq closed at 14,339.99, rising 193.28 points (1.37%).

The market awaited the U.S. Department of Labor's November nonfarm payroll report. As employment slows and inflation weakens, expectations for a Federal Reserve (Fed) rate cut are rising. Wall Street estimates that November nonfarm employment increased by 190,000. However, the unemployment claims data fell short of expectations. The U.S. Department of Labor reported that initial jobless claims last week rose by 1,000 to 220,000, slightly below the expert forecast of 222,000. Nevertheless, the market currently expects the Fed to keep rates unchanged at the December Federal Open Market Committee (FOMC) meeting next week.

However, some caution that expectations for a rate cut may be excessive. In a foreign media survey, half of the economic experts said the Fed would keep rates steady at least until July next year, and even if a rate cut occurs, it would be aimed at adjusting the real interest rate.

Additionally, AI-related stocks led the market rally. Alphabet, Google's parent company, rose more than 5% on optimism following the unveiling of the AI language model 'Gemini.' AMD, which introduced a new AI semiconductor chip challenging Nvidia, surged nearly 10%. Nvidia, the leading AI stock, also gained more than 2%.

Seokhwan Kim, a researcher at Mirae Asset Securities, forecasted that the KOSPI index would start 0.6?0.8% higher on the 8th due to these influences. Ji-young Han, a researcher at Kiwoom Securities, explained, "Despite cautious sentiment ahead of the U.S. November nonfarm payroll results, a differentiated market is expected centered on AI and semiconductor stocks, driven by strong foreign demand, the positive reception of Alphabet’s AI model Gemini, and AMD’s unveiling of new AI semiconductors."