[Good Morning Stock Market] "Rallying US Stock Market... KOSPI Expected to Start Slightly Higher"

As the US stock market continues its rally, the Korean stock market is also expected to start slightly higher on the 5th.

[Image source=Yonhap News]

Last week, the S&P 500 and the Dow Jones Industrial Average closed at 4958.61 and 38,654.42, up 1.38% and 1.43%, respectively. The Nasdaq, which is tech-heavy, closed at 15,628.95, up 1.12%.

On the 2nd (local time), the US stock market rose despite an employment surprise, supported by strong earnings from major companies. Seokhwan Kim, a researcher at Mirae Asset Securities, explained, "The January nonfarm payrolls significantly exceeded market expectations, which reduced expectations for a Federal Reserve (Fed) rate cut," but added, "Major companies like Meta Platforms and Amazon saw significant gains thanks to strong earnings and proactive shareholder return policies."

The Korean stock market is expected to start higher. The Morgan Stanley Capital International (MSCI) Korea Index Exchange-Traded Fund (ETF) fell 2.1%, and the MSCI Emerging Markets Index ETF dropped 0.3%. Considering this, the KOSPI is expected to open slightly higher.

Foreigners have been steadily net buying in the domestic stock market recently. From the 19th of last month to the 2nd of this month, foreigners net bought the KOSPI on 11 out of 12 trading days.

Haejung Yang, a researcher at DS Investment & Securities, said, "Foreign buying, which had been stagnant, is now strongly flowing in, and a change in the market’s supply-demand participants can be positive. Individual investors, who had been leading domestic supply-demand, are following the trend and have been hesitant to buy at low prices during market downturns. In this context, foreign buying supporting the market bottom is a positive momentum for the stock market."