[Good Morning Market] U.S. Semiconductor Rally... Korean Stocks Attempt Rebound After Sharp Plunge

U.S. Semiconductor Stocks Rebound on Bargain-Hunting
KOSPI 200 Overnight Futures Rally and Stabilized Exchange Rate Also Supportive
"Correction Driven More by Overheating Than by Fundamental Weakness"

With the U.S. semiconductor sector rebounding on the back of bargain-hunting inflows, the Korean stock market on June 9 is expected to attempt a similar rebound, particularly led by semiconductor and other sectors that experienced sharp declines the previous day.

U.S. Semiconductor Stocks Rebound Across the Board

On the 8th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average (Dow) closed at 50,786.01, down 80.77 points (0.16%) from the previous session. The S&P 500, which focuses on large caps, rose 21.99 points (0.30%) to finish at 7,405.73, while the tech-heavy Nasdaq gained 220.231 points (0.86%) to close at 25,929.663.

On the 8th (local time), a trader is working at the New York Stock Exchange in the United States. Photo by Reuters and Yonhap News Agency

Shares related to artificial intelligence (AI) and semiconductors drew attention with strong gains. Tensions in the Middle East, which had risen over the weekend, eased somewhat as Israel and Iran agreed to halt attacks. As a result, key stocks such as Nvidia (+1.73%), Intel (+11.19%), Micron Technology (+9.87%), Marvell Technology (+9.63%), and Broadcom (+2.82%) all ended higher. The iShares Semiconductor ETF also finished up 5.87%.

Ji Young Han, a researcher at Kiwoom Securities, commented, "It is worth recalling that the fundamental source of recent macroeconomic uncertainties—such as Federal Reserve policy, inflation, and interest rates—originated from the U.S.-Iran conflict," adding, "Although aftershocks from the recent plunge will likely create volatility throughout the remainder of the week, it is not particularly effective at this point to keep increasing cash holdings."

"Little Likelihood of Undermining the Existing Bull Market Trend"

The rebound in U.S. semiconductor stocks is expected to have a favorable impact on the Korean stock market today. The previous day, the KOSPI plunged more than 8%, with a circuit breaker triggered during trading hours. One researcher predicted, "Thanks to the rebound in U.S. semiconductor stocks, the strong 5.5% rise in the KOSPI 200 overnight futures, and the stabilization of the surging dollar-won exchange rate due to government intervention, the market will likely recover much of the previous day's losses, particularly among stocks that had fallen excessively."

He further explained, "Ultimately, this correction is not due to fundamentals—such as the peaking of semiconductor profits, loss of policy momentum, or imminent major external shocks—but rather stems from excessive concentration on leading stocks and the burden of elevated valuations. Therefore, the likelihood of a cascading sharp decline that would threaten the ongoing bull market trend is low."

Additionally, the researcher added, "Accordingly, when the KOSPI is below 7,400 points, it is appropriate to increase allocation to existing leading stocks such as semiconductors and multilayer ceramic capacitors (MLCC), other AI value chain-related stocks, and key sectors that have suffered steep declines since May despite solid earnings—including securities, retail, defense, and shipbuilding."

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