[Good Morning Stock Market] "Continued Interest in Semiconductors... KOSPI Expected to Start Higher"

Amid continued interest in semiconductors in the domestic stock market, the KOSPI is expected to start higher on the 1st.

On March 29 (local time), the U.S. stock market was closed for Good Friday ahead of Easter, and on the same day, the U.S. Department of Commerce announced that the core Personal Consumption Expenditures (PCE) price index for February, excluding volatile food and energy, rose 2.8% year-on-year. This is a slight slowdown compared to the 2.9% increase in January year-on-year. It also rose 0.3% month-on-month, lower than January's 0.5% month-on-month increase. The PCE price index measures the prices paid by U.S. residents when purchasing goods and services.

Jerome Powell, Chair of the Federal Reserve (Fed), said regarding this inflation indicator, "It is not as low as most of the positive figures from the second half of last year," but "it is definitely closer to the level we want to see." He also reaffirmed the Fed's stance that in order to cut interest rates, there must be confidence that inflation is continuously declining toward the 2% target.

Han Ji-young and Kim Ji-hyun, researchers at Kiwoom Securities, said, "Since the February inflation data and Chairman Powell's remarks have already been priced into the stock market, the impact on the domestic stock market this week is expected to be minimal." They added, "The point that 'it will be difficult for the benchmark interest rate to return to pre-COVID-19 levels' is noteworthy," and explained, "Even if the Fed enters an interest rate cut cycle in the future, it suggests that the transition from high to low interest rates will not be rapid as in the past, but rather that the market will remain in a prolonged period of medium interest rates and moderate inflation."

The KOSPI is expected to start slightly higher today. Kim Seok-hwan, a researcher at Mirae Asset Securities, analyzed, "The strong performance of the semiconductor sector, which has a large market capitalization weight, played a major role, with the KOSPI and KOSDAQ rising 3.9% and 4.9%, respectively, over the past month. During this period, the operating profit estimates for the semiconductor sector this year improved by 6.2%, but for all listed companies excluding semiconductors, it was only 0.3%. Of the 5.1 trillion won of foreign capital inflows, 92% was concentrated in semiconductors, indicating continued interest in the semiconductor sector."

Researchers Han Ji-young and Kim Ji-hyun said, "This week, changes in export performance of individual sectors such as semiconductors, automobiles, bio-health, and machinery, which have recently seen concentrated supply and demand in the domestic stock market, will be key." They added, "Furthermore, it is the period ahead of the first-quarter earnings season. The March export data to be released today and Samsung Electronics' preliminary first-quarter earnings to be announced on the 5th will be important as they serve as indicators of the first-quarter performance of major domestic sectors such as semiconductors."

Meanwhile, the one-month New York Non-Deliverable Forward (NDF) won-dollar exchange rate stands at 1,344 won, and the won-dollar exchange rate is expected to start 4 won lower today.