KOSPI Takes a Breather Amid Ongoing Middle East Military Tensions

KOSPI Drops Over 1% Amid Ongoing Middle East Conflict
KOSDAQ Rebounds After Six Sessions
Goldman Sachs Raises KOSPI Target to 12,000

On June 4, as all three major New York Stock Exchange indices closed lower and the KOSPI also started lower, an employee is monitoring the stock market and exchange rates in the dealing room at the headquarters of Hana Bank in Jung-gu, Seoul. On that day, the KOSPI opened at 8,623.82, down 177.67 points (2.02%) from the previous trading day, the KOSDAQ rose 6.88 points (0.67%) to 1,032.91, and the won/dollar exchange rate started at 1,530.0, up 13.6 won. Photo by Jo Yongjun

As the military confrontation between the United States and Iran continues, the KOSPI took a breather and declined after four consecutive sessions of gains. In contrast, the KOSDAQ rebounded after six sessions, returning to an upward trend. With strong profit growth led by the memory semiconductor sector, there is an outlook that the KOSPI will attempt to reach the 10,000-point mark again after a period of adjustment.

On June 4, the KOSPI opened at 8,623.82, down 2.02% from the previous trading day, but reduced its losses to trade at 8,686.49, down 1.31%, as of 10:01 a.m. The KOSPI had risen for three consecutive trading sessions from May 29 to June 2, but is showing a downward trend on this day.

The KOSDAQ started the session at 1,032.91, up 0.67%, and further expanded its gains to trade at 1,054.69, up 2.86%. This marks the first rebound in six trading sessions for the KOSDAQ.

The KOSPI was also affected by the decline in the U.S. stock market, which was weighed down by continued attacks between the United States and Iran. On June 2, Iran struck Kuwait with missiles and drones, causing numerous casualties. Previously, the United States had sunk an Iran-bound oil tanker, with both sides continuing their clashes. As a result, the Dow Jones Industrial Average fell 1.21%, the Standard & Poor’s 500 Index declined 0.74%, and the Nasdaq Composite dropped 0.89%. The S&P 500 and Nasdaq ended their nine-session winning streaks with these declines. Seo Sangyoung, a researcher at Mirae Asset Securities, explained, “The rise in international oil prices and treasury yields due to the U.S.-Iran military clash has impacted the stock market.”

In the domestic market, the decline among large-cap stocks was notable. As of 10:03 a.m., Samsung Electronics was trading at 3,590,000 won, down 0.42% from the previous trading day. SK hynix was down 3.01% to 22,890,000 won. Hyundai Motor (-3.29%), Samsung Electro-Mechanics (-2.54%), LG Energy Solution (-5.20%), and Samsung Life Insurance (-12.08%) were also trading lower.

Although the KOSPI is undergoing a correction, positive forecasts continue, supporting the possibility of further gains. On the previous day, the global investment bank Goldman Sachs raised its KOSPI target from 9,000 to 12,000 in its latest report. Goldman Sachs analyzed, “Thanks to this year’s boom in memory semiconductors, the expected earnings growth rate of KOSPI-listed companies has been revised up from 48% at the start of the year to 277% at present,” adding, “This earnings growth will drive the KOSPI’s strength.”

Korea Investment & Securities also raised its upper-end KOSPI target from 9,250 to 11,000 on this day. Kim Daejun, a researcher at Korea Investment & Securities, explained, “Semiconductors, which are now in a super cycle, are generating huge profits and supporting the index’s rise,” adding, “The 12-month operating profits of Samsung Electronics and SK hynix are expected to be about 10% higher than previous forecasts.”

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