[Good Morning Stock Market] "Nasdaq Hits All-Time High... Expecting KOSPI to Rally"

The U.S. stock market closed higher due to strength in individual stocks despite rising interest rates. Accordingly, the domestic stock market is also expected to show an upward trend on the 2nd.

[Image source=Reuters Yonhap News]

On the 1st (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average, centered on blue-chip stocks, closed at 39,169.52, up 50.66 points (0.13%) from the previous trading day. The S&P 500 index, focused on large-cap stocks, rose 14.61 points (0.27%) to 5,475.09, and the Nasdaq index, centered on tech stocks, closed at 17,879.30, up 146.7 points (0.83%).

The U.S. manufacturing economic indicator released that day acted as a negative factor for the market. The Institute for Supply Management (ISM) reported that the June Manufacturing Purchasing Managers' Index (PMI) recorded 48.5, falling short of both the expert forecast (49.2) and the previous month’s figure (48.7). A PMI below 50 indicates economic contraction, while above 50 indicates expansion.

However, individual stocks showed strength, leading to a positive close. Tesla’s stock price surged more than 6%, while Microsoft (MS), Apple, and Amazon each rose more than 2%.

Seokhwan Kim, a researcher at Mirae Asset Securities, explained, "The U.S. stock market temporarily declined as the June ISM Manufacturing PMI fell short of market expectations. However, buying momentum continued to flow mainly into the Magnificent 7 (Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, Tesla), resulting in a positive close."

The Morgan Stanley Capital International (MSCI) Korea Index Exchange-Traded Fund (ETF) rose 0.1%, and the MSCI Emerging Markets Index ETF increased by 0.2%. Eurex KOSPI 200 futures fell 0.5%.

Jiyoung Han, a researcher at Kiwoom Securities, said, "Despite rising U.S. interest rates stemming from uncertainties such as Trump’s election, major artificial intelligence (AI) stocks like Nvidia and Apple rose. Supported by expectations for the earnings season due to strong new orders in the U.S. ISM, an upward trend is expected."

He added, "Since the KOSPI has reached the symbolic level of 2,800 points again, there may be a psychological and visual burden of a peak. However, the KOSPI’s 12-month forward price-to-earnings ratio (PER) is currently 9.78 times, which is relatively attractive in terms of valuation compared to past price levels."