[Good Morning Market] US Stocks Fall Amid Economic Slowdown Concerns... Domestic Market Also on Edge

Three Major U.S. Indices Record Largest Decline of the Year
Key Economic Indicators and Nvidia Earnings Announcement Scheduled
Domestic Stock Market Expected to Remain in Wait-and-See Mode

Last week, major U.S. stock indices closed down one after another. This is interpreted as concerns over economic slowdown growing due to a flood of negative economic indicators and rising expected inflation. On the 24th, a tense atmosphere also prevailed in the domestic stock market.

Earlier, on the 21st (local time), the S&P 500 index closed at 6013.13, down 1.7% from the previous trading day. The Nasdaq index, centered on technology stocks, also fell 2.2% to 19,524.01 compared to the previous day. The Dow Jones Industrial Average also ended trading at 43,428.02, down 1.69%. All three indices showed the largest declines so far this year.

This appears to be due to concerns over the Trump administration's tariff policies and a sharp drop in consumer sentiment, which heightened inflation worries. According to S&P Global, the U.S. services Purchasing Managers' Index (PMI) for February was 49.7, below the expected 52.8%. It contracted for the first time in 25 months since January 2023, signaling economic contraction. The consumer sentiment index for February also fell 7 points from the previous month to 64.7, below market expectations of 67.8. With major economic indicators underperforming and Walmart issuing disappointing earnings guidance, signaling future consumption slowdown, selling pressure is believed to have spread.

This week, it is expected that a cautious stance will continue amid tension. Starting with the Dallas Federal Reserve's February manufacturing index on the 24th, key indicators such as weekly initial jobless claims on the 27th and the Personal Consumption Expenditures (PCE) price index on the 28th are scheduled to be released. Key figures from the U.S. Federal Reserve, including Dallas Fed President Lori Logan and Atlanta Fed President Raphael Bostic, are also expected to speak. Earnings announcements for major artificial intelligence (AI) companies such as Nvidia and Salesforce for the fourth quarter of last year are scheduled after market close on the 26th.

Considering this schedule, the domestic stock market is also expected to show volatility. In the short term, the market is analyzed to be sensitive to individual data and prone to overinterpretation. The MSCI Korea Index Exchange-Traded Fund (ETF), closely linked to the domestic market, also closed down 1.49%. The Philadelphia Semiconductor Index fell 3.28%. The KOSPI night futures also dropped 1.25%.

Han Ji-young, a researcher at Kiwoom Securities, explained, "The influence of macroeconomic indicators and political events such as the Bank of Korea's Monetary Policy Committee, U.S. February PCE inflation, and the German general election is expected to be high. Amid the semiconductor sector's stock price differentiation caused by the China DeepSeek incident, changes arising from Nvidia's earnings announcement will also be a point to watch."