[Good Morning Stock Market] "Expectations for Foreign Investors' Return... Semiconductors, Healthcare, and Automobiles Performing Well"

As the U.S. stock market recorded its highest weekly gain this year, showing signs of escaping recession fears, the domestic stock market on the 19th is expected to see a recovery in sector investments such as semiconductors and healthcare, driven by the return of foreign investors.

[Image source=Reuters Yonhap News]

On the 16th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 40,659.76, up 96.70 points (0.24%) from the previous session. The S&P 500 index rose 11.03 points (0.20%) to 5,554.25, and the Nasdaq Composite Index closed at 17,631.72, up 37.22 points (0.21%).

Kim Seok-hwan, a researcher at Mirae Asset Securities, said, "The S&P 500 and Nasdaq indices rose 4.0% and 5.3% respectively for the week, marking the best weekly gain in the U.S. stock market this year," adding, "This shows a complete escape from the fear of recession." He also noted, "Goldman Sachs lowered the probability of a U.S. recession from 25% to 20%, and stated that 'if future employment data improves, it could be lowered further to 15%.'"

The Morgan Stanley Capital International (MSCI) Korea Index Exchange-Traded Fund (ETF) rose 1.2%, and the MSCI Emerging Markets Index ETF increased by 0.5%. Eurex KOSPI 200 futures closed up 0.2%.

Researcher Kim emphasized, "We are placing our hopes on the return of foreign investors. Over the past week, foreign investors recorded a net purchase of about 1.7 trillion won in the domestic market, leading the stock market rebound." He explained, "Notably, about 84% of the weekly foreign net purchases, approximately 1.4 trillion won, were concentrated in semiconductors. The cumulative net purchase volume for the semiconductor sector, which had fallen to around 13.7 trillion won a week ago, has recovered to about 15.5 trillion won." He added, "The recent favorable exchange rate environment can also be viewed positively. Additionally, healthcare, automobiles, and machinery sectors are showing good performance."

Han Ji-young and Kim Ji-hyun, researchers at Kiwoom Securities, said, "Volatility is expected to continue from the beginning of the week," and forecast the weekly KOSPI range to be between 2,630 and 2,760 points. They added, "The domestic stock market has entered a phase influenced by political and macroeconomic factors such as whether investment in election-related assets will expand after the U.S. Democratic National Convention, remarks by Federal Reserve Chairman Jerome Powell at the upcoming annual economic policy symposium (Jackson Hole Meeting), and key manufacturing Purchasing Managers' Index (PMI) data from the U.S. and Eurozone."

Meanwhile, the 1-month non-deliverable forward (NDF) won-dollar exchange rate in New York was at 1,348 won, and the won-dollar exchange rate is expected to start the day down 4 won.