[Good Morning Stock Market] "KOSPI Expected to Start Slightly Higher... Anticipation of Bargain Buying Amid Sharp Decline"

US Q1 GDP Falls Short at 1.3% Forecast
Salesforce Q1 Earnings Shock Sends Stock Plunging
Investment Sentiment Weakens... Expected Offset by Bargain Hunting Sentiment

Marc Benioff, CEO of Salesforce.com

The Korean stock market is expected to start slightly higher on the 31st. Although the U.S. stock market closed lower due to the slowdown in the first-quarter economic growth rate (GDP) and news of export restrictions on AI chips to the Middle East, it is analyzed that bargain hunting will flow in after the excessive sharp decline.

On the previous day (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 38,111.48, down 330.06 points (0.86%) from the previous trading day. The S&P 500 index fell 31.47 points (0.60%) to 5,235.48, and the tech-heavy Nasdaq index closed at 16,737.08, down 183.50 points (1.08%). The Dow showed losses for three consecutive trading days, while the S&P 500 and Nasdaq also declined for two consecutive days.

The U.S. stock market was weighed down by Salesforce's first-quarter earnings. Salesforce, the world's number one enterprise customer relationship management (CRM) software company, announced first-quarter results that fell short of expectations. As a result, its stock price plunged more than 19%, marking the largest drop since 2008.

Nvidia, which had shown gains for four consecutive trading days, also fell more than 3%. This was influenced by news that the U.S. government is delaying the issuance of licenses for large-scale shipments of AI accelerators to the Middle East by chip manufacturers such as Nvidia and Advanced Micro Devices (AMD) for national interests.

The slowdown in U.S. economic indicators also dampened investor sentiment. The preliminary estimate of the U.S. first-quarter GDP growth rate was 1.3%, significantly lower than the flash estimate of 1.6% announced last month. It is evaluated that the decline in overall growth was driven by the real personal consumption increase rate falling short of market expectations.

Although the Korean stock market closed lower for two consecutive days, it is expected to start slightly higher due to bargain hunting sentiment. Kim Seok-hwan, a researcher at Mirae Asset Securities, said, "Although investment sentiment will be affected by the contraction, it will be offset by the decline in U.S. long-term bond yields and the surge of stocks hitting 52-week lows," adding, "The KOSPI is expected to start slightly higher."