[Good Morning Stock Market] Mixed Close Ahead of Christmas... KOSPI Expected to Take a Breather

As the Christmas holiday approaches, the U.S. stock market closed mixed, and on the 26th, the domestic stock market is also expected to enter a short-term pause.

[Image source=Reuters Yonhap News]

On the 22nd (local time), at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 37,385.97, down 18.38 points (0.05%) from the previous session. The large-cap focused Standard & Poor's (S&P) 500 index rose 7.88 points (0.17%) to 4,754.63, and the tech-heavy Nasdaq index closed up 29.11 points (0.19%) at 14,992.97.

Park Gwangnam, a researcher at Mirae Asset Securities, said, "Despite the slowdown in inflation rates, the U.S. stock market showed signs of fatigue. The trend of easing inflation strengthened, leading to a rise at the start of the session on the 22nd, but as the session progressed, profit-taking continued, confirming the burden on market participants from recent gains."

This week, the Korean stock market is expected to be influenced by year-end and New Year expectations, but the recent short-term price increases combined with sluggish trading ahead of the year-end close are likely to limit the momentum for stock price gains in the short term.

Han Jiyoung and Lee Seonghun, researchers at Kiwoom Securities, said, "This week, major U.S. manufacturing indicators, changes in government bond yields, and China's manufacturing and services Purchasing Managers' Index (PMI) are key macroeconomic events to watch. Domestically, the atmosphere is expected to be dominated by unique year-end supply and demand events such as major shareholder capital gains tax and ex-dividend dates." The weekly KOSPI expected range is forecasted to be between 2,540 and 2,640 points.

They added, "Considering inflation data, favorable economic indicators, and corporate earnings forecasts, there is no reason to view the stock market environment negatively for next year," but also noted, "It is appropriate to prepare for a short-term pause. Currently, the KOSPI has risen for seven consecutive weeks for the first time this year, breaking through the upper bound of the box range that had confined it last month and this month. The Nasdaq also recorded its second seven-week winning streak this year, hitting new highs, so attention should be paid to the gradually increasing concerns about short-term overheating in investor sentiment."