[Good Morning Stock Market] "KOSPI, Volatility Expansion Expected"

On the 10th, the KOSPI is expected to experience increased volatility. This week is anticipated to be decisive for the stock market direction, as the U.S. Federal Open Market Committee (FOMC) regular meeting and the U.S. May Consumer Price Index (CPI) announcement are scheduled.

On the 7th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 38,798.99, down 87.18 points (0.22%) from the previous session. The S&P 500 index fell 5.97 points (0.11%) to 5,346.99, and the Nasdaq index dropped 39.99 points (0.23%) to 17,133.13.

This was due to disappointment over strong employment data dampening expectations for a Federal Reserve (Fed) interest rate cut. The U.S. Department of Labor announced that nonfarm payroll employment increased by 272,000 in May, significantly exceeding the expert forecast of 190,000 compiled by The Wall Street Journal (WSJ). The May unemployment rate also rose to 4.0%, surpassing both the previous month’s figure and market expectations.

Last week, the domestic stock market closed higher, reflecting relief from high interest rate concerns and positive news during the market holiday period, with growth and thematic stocks leading the gains. Nvidia denied rumors about failing Samsung Electronics’ quality tests, which helped restore investor sentiment in the semiconductor sector and led to a rebound.

The Korean stock market is expected to show volatility during the week due to factors such as the upcoming U.S. May CPI, June FOMC, Apple’s Worldwide Developers Conference (WWDC), Nvidia’s stock split trajectory, and fluctuations in foreign and institutional investors’ futures and options supply and demand around the synchronized expiration date. Kiwoom Securities projected the weekly KOSPI range to be between 2,650 and 2,780 points.

In particular, Apple-related events, which had been sidelined in the recent artificial intelligence (AI) rally, are a key point to watch. Apple is expected to unveil a new iPhone equipped with AI features at the WWDC held from the 10th to the 14th. Ji-Young Han, a researcher at Kiwoom Securities, stated, "This could shift interest within the AI sector toward on-device AI," adding, "There is a strong possibility that domestic IT component stocks such as display and camera manufacturers will gain price momentum."

Major domestic and international indicators also warrant close attention. Han noted, "On the 13th, when the June FOMC results are reflected, the domestic futures and options simultaneous expiration date is scheduled, which must be considered." She added, "As the market interprets the inflation path after the May CPI and the Fed’s monetary policy path after the June FOMC differently, volatility from supply and demand fluctuations around the futures and options expiration date may intensify. Therefore, major domestic and international stock markets are expected to remain in a phase of increased volatility from midweek through early next week."