[Good Morning Market] KOSPI Moves Sideways Without Clear Direction... "Focus on Jackson Hole and Tax Reform"

The KOSPI is moving sideways without a clear direction, which appears to be influenced by a lack of momentum. This week (August 18-22), the KOSPI is expected to seek direction as it is affected by issues such as the Jackson Hole meeting and tax reform proposals.

Yonhap News

Last week (August 11-15), the KOSPI fluctuated around the 3,200 level. The index recorded a low of 3,189.58 and a high of 3,242.17, indicating that volatility remained limited. Lee Kyungmin, a researcher at Daishin Securities, explained, "During the rally in June, daily trading volume increased by nearly 18 trillion won, but the trend of declining trading volume has become clear. The KOSPI is moving sideways without a clear direction, with stock- and theme-driven trading dominating the market."

This week, the KOSPI is expected to focus on the Jackson Hole meeting in the United States and the speech by Jerome Powell, Chair of the Federal Reserve. Currently, Chair Powell is facing pressure from President Donald Trump, who continues to call for interest rate cuts, as well as internal conflicts within the Fed from those who share the president's views. Whether Powell will provide any hints about a rate cut in his upcoming speech is a key point of interest.

Additionally, attention is being paid to the ceasefire negotiations in the Russia-Ukraine war. Han Jiyeong, a researcher at Kiwoom Securities, stated, "The meeting between President Trump and Russian President Vladimir Putin ended without a deal. However, whether the meeting between the Ukrainian president and Trump scheduled for later this week will lead to a ceasefire agreement is expected to affect the supply and demand for domestic reconstruction-themed stocks and defense stocks."

Furthermore, the issue of tax reform proposals is also likely to have a significant impact. Han Jiyeong emphasized, "So far, the government has maintained its stance of sticking to the original plan. However, it is worth noting that the ruling party is advocating for a stock market-friendly compromise, citing reasons such as tax fairness (the issue of double taxation and limited tax revenue effects)."

Meanwhile, on August 15 (local time), the New York stock market showed mixed results. The Dow Jones Industrial Average closed at 44,946.12, up 34.86 points (0.08%) from the previous session. The S&P 500 index fell 18.74 points (0.29%) to close at 6,449.80, while the tech-heavy Nasdaq Composite dropped 87.69 points (0.40%) to finish at 21,622.98.

Kim Seokhwan, a researcher at Mirae Asset Securities, said, "The U.S. stock market overall showed mixed results. The tech-focused Nasdaq, in particular, saw a notable deterioration in investor sentiment due to the announcement of possible semiconductor tariffs."