[Good Morning Market] New York Stock Market Ends Mixed... Korean Market Expected to Remain Cautious

Major U.S. Indices Remain Flat
Lack of Progress in U.S.-China Tariff Talks
Cautious Sentiment Ahead of Big Tech Earnings and Economic Data Releases

As the United States and China have failed to produce any significant outcome in their tariff negotiations, the three major indices on the New York Stock Exchange ended mixed after fluctuating throughout the session. The domestic stock market is also expected to show a wait-and-see attitude.

On the 28th (local time) at the New York Stock Exchange (NYSE), the S&P 500 index closed at 5,528.75, up 0.05% from the previous session. The tech-heavy Nasdaq index ended the session at 17,366.13, down 0.10%. Only the Dow Jones Industrial Average rose, closing at 40,227.59, up 0.28%. Concerns over an economic slowdown and some profit-taking led to declines, but as losses in major tech stocks narrowed or turned positive, the market finished mixed. Analysts noted that the session was largely characterized by a pause after four consecutive days of sharp gains.

First, concerns about an economic slowdown were triggered by reports that container booking and arrival times at U.S. ports have decreased due to reduced trade caused by tariffs. Comments by U.S. Treasury Secretary Scott Besant, who said that U.S.-China trade negotiations are at a standstill, also added to the pressure. In an interview with foreign media, Secretary Besant stated, "We will have to wait and see what happens with China," and added, "The Chinese side probably also sees that the current situation is unsustainable, and at some point, they might call us."

This revealed that the reality is different from President Donald Trump's claim that he is conducting trade negotiations, including recent phone calls with Chinese President Xi Jinping. Chinese Foreign Ministry spokesperson Guo Jiakun also stated, "As far as I know, there has been no phone call between the two leaders."

This week, major economic indicators are scheduled for release, including executive orders related to President Trump's 100th day in office (such as tax cuts and immigration), GDP growth rate, Personal Consumption Expenditures (PCE) price index, Institute for Supply Management (ISM) manufacturing index, and the employment report. In addition, as major U.S. big tech companies such as Microsoft, Meta, Amazon, and Apple are set to announce their earnings, the strong wait-and-see sentiment also appears to have contributed to the mixed market.

U.S. Treasury yields fell, reflecting economic uncertainty. Even though the U.S. Treasury Department sharply raised its estimate for second-quarter Treasury issuance to $514 billion, exceeding the previous estimate of $123 billion, yields continued to decline. Seo Sangyoung, a researcher at Mirae Asset Securities, analyzed, "Since the debt ceiling has not been raised, the Treasury is holding less cash than expected, so this is not seen as a substantial increase in borrowing," and added, "As the previously unstable bond market stabilized, the stock market also rebounded."

The domestic stock market is also likely to remain flat amid a wait-and-see atmosphere. The MSCI Korea Index ETF and the Philadelphia Semiconductor Index, both closely linked to the domestic market, fell by 0.29% and 0.38%, respectively. The KOSPI night futures also declined by 0.03%.

Han Jiyeong, a researcher at Kiwoom Securities, said, "Due to the mixed performance of the U.S. stock market and caution ahead of major macroeconomic events later in the week, we expect a market driven by individual earnings reports," and added, "From a sector perspective, it will be important to watch whether the easing of U.S. Treasury issuance concerns and the resulting decline in interest rates will lead to a rebound in bio stocks, which plunged the previous day."