[Good Morning Stock Market] US Stocks Rise on 'Dovish Powell' Interpretation... "KOSPI Expected to Start Higher"

Following remarks on interest rates by Jerome Powell, Chair of the U.S. Federal Reserve (Fed), which were interpreted as 'relatively not hawkish (preferring monetary tightening),' the three major indices of the New York Stock Exchange closed higher, and the KOSPI is expected to start higher on the 3rd.

[Image source=Reuters Yonhap News]

On the 2nd (local time), at the New York Stock Exchange (NYSE), the blue-chip-focused Dow Jones Industrial Average closed at 38,225.66, up 322.37 points (0.85%) from the previous trading day. The large-cap-focused S&P 500 rose 45.81 points (0.91%) to 5,064.2, and the tech-heavy Nasdaq index jumped 235.48 points (1.51%) to close at 15,840.96.

By individual stocks, semiconductor company Qualcomm reported earnings that exceeded market expectations, supported by a recovery in the smartphone market and the launch of AI-based smartphones, with its stock rising 9.74%. Used car sales platform Carvana surged 33.79% after announcing record-high earnings, and pharmaceutical company Moderna rose 12.68% after reporting smaller-than-expected losses. Restaurant delivery service DoorDash fell 10.32% following earnings below market expectations. With bond yields falling, tech stocks such as Nvidia (3.34%) and Amazon (3.2%) also rose. Apple, which reported earnings after the market close, rose 2.2% during regular trading hours.

At the previous day’s Federal Open Market Committee (FOMC) meeting, the Fed kept the federal funds rate unchanged for the sixth consecutive time at 5.25?5.5%. Chair Powell stated at the press conference, "I want to say the possibility (of a rate hike) is almost zero," and the market was relieved, interpreting this as more dovish (preferring monetary easing) than expected.

On the same day, KB Securities researchers Ji-won Kim and Jeong-eun Lim said, "Amid various interpretations of Chair Powell’s remarks, the exclusion of the possibility of a rate hike was positively received, leading to gains in the three major indices." They added, "A positive trend centered on tech stocks, including AI semiconductors and smartphone-related stocks, is expected due to strong earnings from Qualcomm and Apple." They noted, "Attention has shifted to the U.S. employment data released tonight. With declines in exchange rates and interest rates, the domestic stock market is expected to start with a rebound followed by differentiation."