The KOSPI has fallen by more than 2% over the past week, struggling to stage a rebound. Attention is turning to whether concerns about AI (artificial intelligence) profitability, one of the factors dragging down the index, will be dispelled by next week's earnings releases from hyperscaler companies such as Microsoft and Samsung Electronics.
Additionally, the Federal Open Market Committee (FOMC) of the Federal Reserve System (Fed) will decide on the October base rate. The outcome is expected to determine the burden of corporate bond interest rates for AI companies.
On the 23rd, the KOSPI closed at 5550.30, up 16.53 points (0.30%) from the previous trading day. The KOSPI index showed a decline of 1% to 3% in early trading, falling as low as 5305.98. This marked the first time since July 29 that the KOSPI index fell below the 5400th line during intraday trading. However, it successfully turned positive by narrowing its losses throughout the session.
The KOSPI's sluggish start to the day stemmed from concerns about AI profitability raised following Meta's earnings release overnight. Meta's third-quarter cash flow recorded a deficit of minus $2.12 billion, a reversal from the previous quarter's $780 million.
Although both revenue and EPS (earnings per share) were solid, the deterioration in cash flow sparked concerns over whether funding for large-scale AI infrastructure investment would be feasible. Nevertheless, the market closed higher on the strength of some major stocks. On this day, only 144 stocks closed higher in the KOSPI market, while 517 stocks declined.
SK Hynix's rebound of more than 4% was notable. Before the opening bell on this day, SK Hynix announced that it had halted its consideration of Solidigm's IPO and pre-IPO promotion. It is interpreted that the stock price, which had been weighed down by concerns that Solidigm's IPO could erode SK Hynix's shareholder value, rebounded following the withdrawal of the listing.
However, some argue that this is merely a short-term factor reversing losses, and that demonstrating the sustainability of the memory semiconductor profit cycle is necessary for a trend-based rebound.
Lee Kyung-min, Head of FICC at Daishin Securities, stated, "The domestic stock market continued to weaken amid risk-off sentiment, but the decline was relatively limited as the sharp drops in Samsung Electronics and SK Hynix on the previous day had already priced in the shock from AI investment concerns stemming from Meta and Tesla."
He added, "In particular, SK Hynix saw improved investor sentiment following news of the Solidigm IPO withdrawal, leading to a strong performance."
On this day, in the KOSPI market (based on Korea Exchange data), retail investors and institutional investors made net purchases of 52.7 billion won and 872.2 billion won, respectively. Among institutional investors, pension funds and others bought 52.8 billion won worth of shares. Foreign investors made net sales of 992.8 billion won.
Among KOSPI sectors, pharmaceuticals rose by more than 3%. Medical and precision instruments gained in the 2nd% range, while electrical and electronics products rose in the 1st% range. Manufacturing, insurance, and construction closed slightly higher, while finance, IT (information and communications) services, and others closed slightly lower. Securities, distribution, and telecommunications fell by more than 1%. Machinery and equipment dropped in the 2nd% range, while chemicals and metals declined in the 3rd% range.
Among top KOSPI market capitalization stocks, Samsung Biologics surged by more than 7%. SK Hynix rose by more than 4%, and SK Square gained over 3%. Samsung Life Insurance rose in the 1st% range. Samsung Electronics closed slightly higher, while Samsung C&T closed slightly lower. Celltrion closed slightly higher, overtaking Kia to finish trading at 11th place in market capitalization. LG Energy Solution and Hyundai Motor fell in the 1st% range. Samsung SDI and KB Financial Group declined by more than 2% and 3%, respectively.
The KOSDAQ closed at 751.69, down 12.41 points (1.62%) from the previous trading day. This marked the first time since August 3, when it recorded 737.35, that the KOSDAQ fell below the 760th line on a closing basis.
In the KOSDAQ market, foreign investors and institutional investors made net sales of 44 billion won and 24.7 billion won, respectively. Retail investors made net purchases of 63 billion won. Although retail investors made net sales of 31.2 billion won and foreign investors made net purchases of 40.9 billion won in early trading on this day, the trend reversed during the session.
All KOSDAQ sectors declined. Publishing and media reproduction plunged by more than 5%. Finance fell by more than 4%. Metals, distribution, electrical and electronics products, and others dropped in the 2nd% range. Entertainment and culture, general services, non-metals, chemicals, machinery and equipment, IT services, and others fell by more than 1%. Pharmaceuticals, transportation equipment and parts, telecommunications, and construction remained slightly lower.
Among top KOSDAQ market capitalization stocks, Ecopro and Ecopro BM closed down by more than 5%. Lino Industrial fell by more than 4. Jusung Engineering and RAINBOW Robotics dropped by more than 3%. Alteogen declined in the 2nd% range, while Iotech fell in the 1st% range. Among the top 12 stocks by market capitalization, HLB was the only one to close slightly higher.
Key schedules for next week include the U.S. Federal Reserve's FOMC meeting held on the 27th and 28th (local time), as well as earnings releases from major companies such as SK Hynix and Samsung Electronics.
Research analysts Im Jeong-eun and Tae Yun-seon at KB Securities stated, "Confirming the interest rate path through the FOMC and earnings releases from major domestic and foreign companies are key variables." They added, "It is necessary to pay attention to whether semiconductor investor sentiment will recover following SK Hynix's earnings on the 28th and Samsung Electronics' earnings on the 29th, and whether foreign supply and demand will improve."
Research analyst Lee Sang-yeon at Shin Young Securities explained, "For the domestic stock market to stage a trend-based rebound, doubts about how long profits derived from AI demand will last must be resolved." He added, "It is important to see whether next week's earnings releases from hyperscalers (large-scale data centers) and Samsung Electronics can dispel such uncertainty."
On this day, in the Seoul foreign exchange market, the won/dollar exchange rate closed weekly trading at 1,324.6 won, up 0.4 won from the previous trading day's closing price.
in STOCK
