[Good Morning Market] New York Stocks Approach Record Highs... Korean Market Eyes Rebound

The New York stock market is poised to reach record highs, driven by expectations of an extension in tariff negotiations. After losing the 3,100 level, the KOSPI is expected to rebound on June 27, supported by bargain hunting and other factors.

Reuters Yonhap News

On June 26 (local time), at the New York Stock Exchange, the blue-chip Dow Jones Industrial Average rose by 404.41 points (0.94%) to close at 43,386.84. The large-cap S&P 500 index gained 48.86 points (0.8%) to finish at 6,141.02. The tech-heavy Nasdaq index climbed 194.36 points (0.97%) to end the session at 20,167.91.

During the session, the S&P 500 rose as high as 6,146.52, nearly surpassing its previous intraday record of 6,147.43 set on February 29, 2025. The Nasdaq also approached its all-time intraday high of 20,204.58, set on December 16, 2024.

With geopolitical risks in the Middle East easing and the White House signaling a possible extension of the tariff negotiation deadline, investor sentiment improved. White House spokesperson Karoline Leavitt stated, "The deadline is not important," and added, "It could be extended, but that is for the President to decide."

Additionally, speculation that President Donald Trump may nominate a successor to Federal Reserve Chair Jerome Powell earlier than expected led to declines in both interest rates and the value of the US dollar.

On June 26, the KOSPI closed at 3,079.56, down 28.69 points (0.92%) from the previous session. The decline was attributed to profit-taking by foreign and institutional investors, as well as concerns over the recent sharp rally. Lee Kyungmin, a researcher at Daishin Securities, explained, "The KOSPI continued to see profit-taking, especially in recently surging stocks, and ended below the 3,100 level. Recent issues that had driven the market up, such as easing geopolitical tensions and policy expectations, have already been largely priced in."

However, a rebound is expected today. Kim Jiweon, a researcher at KB Securities, noted, "As the deadline for mutual tariff suspension approaches, the possibility of an extension is being raised, which is positive for the market at a time when anxiety is rising." She added, "Although the domestic market saw a correction the previous day, foreign buying driven by a weaker dollar?or, in its absence, support from individual investors?is likely to provide a floor for the market."

Lee Sunghoon, a researcher at Kiwoom Securities, also commented, "The domestic market is expected to open higher on the back of the possible extension of the mutual tariff suspension period, increased expectations for a Federal Reserve rate cut, and bargain hunting following the previous day's sharp decline." He added, "For the time being, market movements are likely to be driven by sector rotation within the domestic market."