[Market ING] KOSPI Attempts to Settle Above 6,700, Focusing on Earnings and Employment Data

Last week, the KOSPI index briefly surpassed the 6,700 mark during intraday trading, but failed to hold above that level. As the beginning of May is expected to see a period of consolidation, it is anticipated that the KOSPI will attempt to settle above 6,700 this week, with market participants focusing on corporate earnings and U.S. employment data.

Yonhap News Agency

Last week, the KOSPI rose by 1.90%, while the KOSDAQ fell by 0.97%. The KOSPI not only secured the 6,600 level but also crossed 6,700. However, on the last trading day of the week, April 30, the index hit a new intraday high before reversing lower and closing in the 6,500 range. Lim Jeongeun, a researcher at KB Securities, analyzed, "On April 30, the KOSPI set a new record by surpassing 6,750 early in the session, but then turned downward as both foreign and institutional investors became net sellers. For the month of April, the KOSPI finished with a gain of over 30%, and the KOSDAQ rose by around 13%."

Kang Jin-hyuk, a researcher at Shinhan Investment Corp., explained, "With major events such as the U.S. Federal Open Market Committee (FOMC) meeting and big tech earnings announcements now concluded, and with multiple market holidays, the market is in a digestion phase. The stock market showed signs of consolidation due to holidays on the 4th (China, Japan, UK), the 5th (Korea, China, Japan), and the 6th (Japan)."

There are projections that a temporary period of consolidation could appear in early May. Kim Jongmin, a researcher at Samsung Securities, said, "While global stock markets continue to hit record highs, the KOSPI also posted its highest monthly return (31%) since 2000, unleashing explosive energy. However, as we enter May,

there is a growing sense of caution regarding the sharp rise." He continued, "With international oil prices continuing to climb and U.S. Treasury yields remaining elevated, a so-called 'high oil price, high interest rate' environment is emerging. As a result, the long-standing stock market adage, 'Sell in May,' is resurfacing. Given the volatile international situation, there is a possibility that a temporary consolidation phase will play out in early May."

Lim Jeongeun, a researcher at KB Securities, predicted, "This week, the market will have to digest a series of major corporate earnings releases and macroeconomic events, including the U.S. April ADP private employment numbers and nonfarm payrolls, which could heighten volatility."

There is also an opinion that there is no reason to exit the market due to short-term volatility. Researcher Kim noted, "Tactical portfolio adjustments and profit-taking are valid, but there is no reason to completely leave the market. Strong earnings from U.S. big tech companies and Korean semiconductor firms are offsetting macroeconomic headwinds. Along with signs of improving global liquidity, Korea's unique 'money move' phenomenon continues to provide solid support for the market. Therefore, while there may be short-term disruptions, the likelihood of a structural downtrend is low."

The key events scheduled for this week include the release of the U.S. April Job Openings and Labor Turnover Survey (JOLTs) and the April Institute for Supply Management (ISM) Services Index on the 5th. On the 6th, the U.S. April ADP private employment report will be published, and on the 8th, the U.S. April employment report will be released.

Corporate earnings announcements will also continue. In the U.S., Palantir is set to report on the 4th, AMD and PayPal on the 5th, ARM and Walt Disney on the 6th, and McDonald's on the 7th. In Korea, SM Entertainment and Hanwha will announce their results on the 6th, while CJ ENM, HD Korea Shipbuilding & Offshore Engineering, HD Hyundai Heavy Industries, APR, and LG will release their first-quarter results on the 7th.

Lee Jaewon, a researcher at Yuanta Securities, commented, "Corporate earnings announcements in Korea and the U.S. will continue, but their impact will definitely be less significant than in the previous week. With most key earnings announcements behind us, the market's attention is likely to shift back to geopolitical tensions involving Iran." He added, "This week, there will be a number of consumer goods earnings releases, so it will be interesting to see if cosmetics companies such as APR can match their strong export performance with robust earnings."

This content was produced with the assistance of AI translation services.