In “Dove Powell”… The Korean Economy soars with the Stock Market, Gold, and Coins

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The Fed is on track for a “3rd rate cut” this year
The three major US indices and the Nikkei are at all-time highs.

< "How long after this?"... KOSPI tops 2,750 > The KOSPI rose 2.41% on the 21st to surpass 2,750 for the first time in 23 months. The KOSDAQ index rose by 1.44%, surpassing the 900 level for the first time in six months. The “all-things rally” took place as major Asian stock markets showed strong performance and even gold, commodities and cryptocurrencies rose. Dealers smile in the newly built dealing room at Hana Bank's main branch in Euljiro, Seoul. / Reporter Bemjoon Kim

The KOSPI index exceeded 2750 for the first time in 23 months. The KOSDAQ index exceeded 900 for the first time in six months. As the three major US stock market indexes simultaneously hit record highs, major Asian stock markets, including Korea, also posted highs. The so-called “Rally of Everything” was revealed, during which the prices of gold and commodities rose and the prices of cryptocurrencies quickly recovered.

On the 21st, the KOSPI index closed at 2754.86 points, increasing by 2.41% compared to the previous day. Foreigners and institutions each made more than 1 trillion won in net purchases. The KOSDAQ index closed at 904.29 points, an increase of 1.44%.

As the US Central Bank (Fed) held a regular meeting of the Federal Open Market Committee (FOMC) on the 20th (local time) and froze the base rate, maintaining the forecast of three rate cuts during the year, that uncertainty eased. was raised spread over the market. The US Dow Jones index (1.03%), the S&P 500 index (0.89%), the Nasdaq index (1.25%) and the Japanese Nikkei index reached record highs. Due to the expectations of reduction of interest rates, the value of the dollar has also decreased by the largest volume this year. The won-dollar exchange rate closed at 1,322 won and 40 won, down 17 won and 40 won from the previous day.

A major player in the global rally that day was semiconductors. US Micron surged 18% in after-hours trading after posting a better-than-expected performance.

In Korea, semiconductor majors Samsung Electronics and SK Hynix led the gains with gains of 3.12% and 8.63% respectively. In the Asian stock markets, only China showed weakness on this day.

“80,000 Electronics” is close due to sudden buying of foreign semiconductors
KOSPI increased due to Pigeon Powell

Foreigners have acquired semiconductor stocks such as Samsung Electronics and SK Hynix. While the leading stocks were in action, the KOSPI rose more than 2% to settle at 2,750. In particular, the value of Samsung Electronics shares reached about 80 thousand won. This is the result of a combination of US monetary policy uncertainty and expectations of increased supply from Nvidia.

○Foreigners are sweeping for the second day

On the 21st, the KOSPI index closed at 2754.86 points with an increase of 2.41%. It has been about 23 months since April 5, 2022 that the KOSPI index exceeded the 2750 level. The previous day's resolution of concerns about the US central bank's (Fed) rate cut delay had an impact. Expectations of a global semiconductor boom also played a role. On the 20th, after positive remarks from Nvidia CEO Jensen Huang about Samsung Electronics and SK Hynix, Micron announced performance and guidance (its expectations) that exceeded market expectations.

Accordingly, Samsung Electronics and SK Hynix, which were ranked first and second by market capitalization in the stock market, rose to lead the index. Samsung Electronics rose 3.12% to end trading at 79,300 won, surpassing the 80,000 Electronics mark. SK Hynix had a bigger growth. It rose 8.63% to recover to 170,000 won.

Foreigners and institutions each bought more than 1 trillion won worth of stocks. On this day, foreigners made net purchases of 1.8782 trillion won on the stock exchange. It is the highest since February 2 (KRW 1.9344 trillion). Foreigners made a net purchase of 853.8 billion won the previous day. Foreigners also bought KOSPI 200 futures worth 1.6164 trillion won. Expectations that the KOSPI index would rise further were reflected. Institutions also bought 1.0525 trillion KRW in the stock market on the day, surpassing the highest level since Dec. 20 (1.1549 trillion KRW). Foreigners and institutions mainly bought Samsung Electronics and SK Hynix. Samsung Electronics (KRW 1.0649 trillion) and SK Hynix (KRW 393.7 billion) bought by foreigners on the day accounted for 77.65% of the total net buying in the stock market. Individual investors sold shares worth 2.911 trillion won, marking the biggest net sale since 1998.

○ Will the KOSPI index exceed 2800?

Securities industry experts believe that the domestic stock market will continue to grow, focusing on the semiconductor industry, which is expected to recover performance for now.

Mirae Asset Securities researcher Kim Seok-hwan explained. “Interest in the internal memory semiconductor industry is expected to continue, which is expected to increase sales and improve earnings.” Researcher Jion Han of Kiwoom Securities says: “Following economically sensitive stocks such as power equipment, shipbuilding, refining and chemicals, which have strengthened since last week, stocks such as semiconductors and secondary batteries, as well as small and midcaps, are rising. Stocks of semiconductor equipment are expected to gain upward momentum.”

Opinions were also voiced that it will not be easy for the KOSPI index to break the limit of 2800. That's because next month's corporate first-quarter earnings announcement and the US consumer price index (CPI) announcement for March could act as variables.

On this day, the KOSDAQ index closed at 904.29 points, an increase of 1.44%. Based on the closing price, it crossed the 900 line for the first time since September 11 last year (912.55).

Reporter Eun Yoon/Heonil Lee youngmoney@hankyung.com

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