[Good Morning Stock Market] Mixed Trends in US Stocks... KOSPI Expected to Show Sector Rotation Trading

[Image source=Yonhap News]

On the 18th, the KOSPI is expected to continue a sector rotation market.

On the previous day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 43,239.05, up 161.35 points (0.37%) from the previous session. The S&P 500 index closed at 5,841.47, down 1.00 point (0.02%), and the Nasdaq Composite closed at 18,373.61, up 6.53 points (0.04%).

The U.S. retail sales for September showed strong performance, but the market perceived it as a level that could stimulate inflation. According to the U.S. Department of Commerce, retail sales in the U.S. for September, seasonally adjusted, increased by 0.4% from the previous month to $714.4 billion. This exceeded the market expectation of a 0.3% increase and the August figure of 0.1% increase.

Looking at major stocks, Nvidia rose 0.9% on positive outlooks that TSMC's artificial intelligence (AI) demand will continue. TSMC's optimistic remarks are believed to have strengthened investor confidence in Nvidia, the leader in the AI chip market. State Street (-0.4%) was affected by strategies involving portfolio restructuring through stake adjustments in Exxon Mobil and Dow.

The Morgan Stanley Capital International (MSCI) Korea Index Exchange-Traded Fund (ETF) fell 0.76%, and the MSCI Emerging Markets Index ETF dropped 0.15%. On this day, the KOSPI is expected to continue a sector rotation market amid continued sluggish trading volume.

Seonghun Lee, a researcher at Kiwoom Securities, forecasted, “As the sector rotation market continues, sensitivity to the Chinese real economy indicators to be announced in the morning is expected to increase in the stock market.”

He analyzed, “Recently, the Greater China stock market has shown some consolidation after a rapid rise following successive stimulus announcements. In particular, the Chinese government’s real estate market stimulus announced the day before was about 4 trillion yuan, roughly twice the initially planned amount, but it did not meet the market’s high expectations, resulting in disappointment selling.” He added, “As market participants’ interest in the scale of China’s stimulus has increased, it is necessary to pay attention to whether the upcoming Chinese real economy indicators and the resulting stimulus expectations will be reflected in the Greater China stock market.”