[Good Morning Stock Market] Despite Trump's Pressure on Powell, Calm Prevails... KOSPI Expected to Remain Calm as Well

Despite Pressure to Dismiss Powell,
U.S. Stock Market Ends Flat

U.S. President Donald Trump pressured Federal Reserve (Fed) Chairman Jerome Powell for dismissal, but the U.S. stock market showed a relatively muted response. Given that the Korean stock market is also holding up relatively well amid unstable external conditions, it is expected that no significant downward pressure will emerge.

On the 17th (local time) at the New York Stock Exchange (NYSE), the S&P 500 index closed at 5,282.70, up 0.13% from the previous session. The tech-heavy Nasdaq index closed down 0.13% at 16,286.45. The Dow Jones Industrial Average experienced a relatively larger drop, falling 1.33% to close at 39,142.23.

On the day, President Trump pressured Chairman Powell to cut interest rates and mentioned the possibility of dismissal. This came after Powell stated in a public speech the day before that there would be no immediate change in monetary policy despite concerns about inflation rising due to tariffs. Trump said, "If I ask, Powell will leave immediately," adding, "I don't like him."

Despite creating uncertainty in the market, the market's reaction was relatively weak. With the 'Good Friday' holiday approaching, investors seemed to be taking a breather, tired of tariff uncertainties.

Individual company earnings stood out somewhat. UnitedHealth's stock fell 22% after disappointing earnings, which contributed to the sharp drop in the Dow Jones index. Nvidia also fell about 3% due to strengthened export restrictions to China. On the other hand, Netflix closed up 1.19% after reporting first-quarter earnings that exceeded market expectations.

Weekly new unemployment claims stood at 215,000, lower than expected, marking the lowest level in two months. This indicated that the employment market remains robust.

Meanwhile, Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), said regarding the global economic outlook, "Economic disruption is expected due to tariffs, and the risk of stress in financial markets has increased," and mentioned that the new global economic growth forecast to be released on the 22nd would be revised downward. However, she drew a line by stating there would be no recession.

News that President Trump is in talks with China was also a positive factor. At an executive order signing ceremony at the White House that day, he said, "We are in talks with China and understand that there have already been several contacts," adding, "We expect to reach an agreement in about three to four weeks."

The Korean stock market is expected to hold up well. Since the KOSPI rebounded after falling to the 2200 level last week, it is analyzed that negative factors have already been priced in. Meanwhile, the MSCI Korea Index Exchange-Traded Fund (ETF), closely linked to the domestic market, closed up 0.77%. KOSPI night futures rose 0.14%. The won-dollar exchange rate, which closed at 1,418.90 won in the Seoul foreign exchange market the previous day, fell slightly further to 1,416.60 won in the night market.

Han Ji-young, a researcher at Kiwoom Securities, said, "Despite the unstable external stock market environment in recent days, the Korean stock market is holding up well," and analyzed, "Today, due to the U.S. stock market holiday and expectations for tariff negotiations between the U.S. and China, the market will show little downward pressure."