[Good Morning Stock Market] "Macro Environment Eases... KOSPI Expected to Start Higher"

The U.S. S&P 500 index and Nasdaq index set new all-time highs for the fourth consecutive trading day on the 13th (local time), leading to expectations that the KOSPI will also start higher.

[Image source=Yonhap News]

On that day at the New York Stock Exchange (NYSE), the blue-chip-focused Dow Jones Industrial Average closed at 38,647.1, down 65.11 points (0.17%) from the previous trading day. The large-cap-focused S&P 500 index rose 12.71 points (0.23%) to 5,433.74, and the tech-heavy Nasdaq index increased by 59.12 points (0.34%) to 17,667.56, marking yet another record high.

This was due to a slowdown in the May Consumer Price Index (CPI) followed by a decline in the Producer Price Index (PPI), a wholesale price indicator. As these two indicators suggest a greater possibility of easing inflation, market expectations for interest rate cuts are also rising.

On the 14th, the KOSPI is also expected to start higher influenced by the eased market environment. Han Ji-young, a researcher at Kiwoom Securities, said, "The KOSPI is expected to start higher supported by a accommodative macro environment and then be influenced during the session by the results of the Bank of Japan (BOJ) monetary policy meeting and fluctuations in the won-dollar exchange rate."

She added, "Regarding the BOJ, it is predicted that the interest rate will be held steady at this meeting to confirm the effects of rate hikes on price and wage increases. The key issue is whether the BOJ will reduce its monthly long-term government bond purchases of 6 trillion yen (approximately 52.9 trillion won) to alleviate the weak yen and narrow the U.S.-Japan interest rate gap."

Kim Ji-hyun, a researcher at KB Securities, said, "The decline in energy prices has eased inflationary pressures, and unemployment indicators suggest a moderate slowdown in the labor market. The drop in government bond yields is also positive. However, the market is experiencing intensified concentration in certain stocks near the peak, and it is necessary to confirm whether buying momentum will spread."