KOSPI is likely to get a breather against a backdrop of a rebound in US stocks. However, its direction ahead will depend on the US October CPI due to be released on the night of the 10th and on how data-center regulations take shape.
KOSPI plunged for two straight sessions last week under the impact of the US midterm elections and is expected to get a breather following the rebound in the New York market over the weekend. The article analyzes that the sustainability of the rebound remains uncertain, and says future developments will depend on the US October CPI on the night of the 10th and developments in data-center regulations.
In the US stock market, semiconductor stocks led the rebound, and the rise in the Philadelphia Semiconductor Index also brought temporary calm to the South Korean stock market. An adviser at Dimensions Investment Advisory pointed to the possibility of a recovery in stocks that had fallen.
The sharp decline is said to have reflected a combination of US policy developments, including not only data-center regulations but also tariffs, environmental policy and efforts to counter China. Oil price trends and interest-rate movements are also seen as contributing factors. Many observers believe sector-by-sector selection will continue until the direction of US policy becomes clear.
This week's schedule includes numerous factors for the market to assess, including the release of the US October CPI and PPI and corporate earnings from Cisco and Applied Materials. The fact that the scope of the regulations' application has not yet been finalized has also been cited as a point for investors to bear in mind. Overall, it remains unclear whether this represents a trend reversal or merely a rebound, and a reassessment will be necessary once the regulations are finalized.