Philadelphia Index Surges 6% on "Apple-Intel Alliance"... Domestic Market Expected to Rise [Good Morning Market]

US-Iran Ceasefire MOU Signed Unexpectedly
KOSPI Expected to Settle Above 9,000
Semiconductor-Focused Strategy Remains Valid

With concerns about energy supply easing due to the signing of a ceasefire memorandum of understanding (MOU) between the United States and Iran, the New York stock market closed higher as semiconductor stocks rallied across the board. The domestic stock market is also expected to continue its upward trend, led by semiconductor stocks.

On June 18 (local time), the Dow Jones Industrial Average closed at 51,564.70, up 72.15 points (0.14%) from the previous session. The S&P 500 index gained 80.48 points (1.08%) to finish at 7,500.58, while the tech-heavy Nasdaq Composite ended trading at 26,517.93, up 496.28 points (1.91%) from the previous session.

The news that the United States and Iran had signed a ceasefire memorandum of understanding (MOU) was the key factor. Although the signing was initially expected to take place on June 19, U.S. President Donald Trump and President Masoud Pezeshkian completed the signing electronically the previous day. As a result, the Strait of Hormuz will remain open without tolls for 60 days. During the next 60 days, negotiations will begin to reach a final agreement on the cessation of military operations, the permanent end of the war, and Iran's nuclear program.

In particular, there was a massive inflow of buying into the semiconductor sector. The Philadelphia Semiconductor Index closed up 6.42%. Intel surged 10.64% after President Trump posted on Truth Social that "Apple has agreed to work with Intel to design and produce chips within the United States." Memory semiconductor companies such as Micron Technology (up 8.7%) and SanDisk (up 11.54%) also showed strong gains. In contrast, SpaceX fell 3.56% for the second consecutive day.

Looking ahead, the financial markets are expected to experience frequent volatility as they closely watch changes in the Federal Reserve's policies under the new chair. In this process, an overall expansion of price volatility in the market seems inevitable. However, it is important to note that the underlying reason for the Federal Reserve signaling a hawkish (preference for monetary tightening) stance at the Federal Open Market Committee (FOMC) meeting in June was the "upside risk to inflation."

Recently, international oil prices, a key variable in inflation indicators, have shown a downward stabilization trend. The average monthly price of West Texas Intermediate (WTI) crude oil fell from the $98 per barrel range in May to the $86 range in June, and as of June 19, it has dropped to around $75, facing additional downward pressure. As the decline in oil prices eases inflationary pressure, the likelihood of the scenario feared by some in the market—"an expansion of Federal Reserve tightening uncertainty → a sharp rise in U.S. market interest rates → a correction phase in the stock market"—is considered low.

Han Ji-young, a researcher at Kiwoom Securities, stated, "With a more than 6% surge in the Philadelphia Semiconductor Index and a more than 3% rise in the KOSPI 200 night futures, the market is expected to start the day with another strong rally led by semiconductors." She added, "During the session, the desire for profit-taking due to the KOSPI breaking through the 9,000-point level, as well as concerns about the pace following a short-term surge, will interact, which will likely limit further upward momentum and shift the market toward sector rotation." She continued, "Although there has been a renewed concentration of funds into the top three blue-chip stocks—Samsung Electronics, SK hynix, and Samsung Electro-Mechanics—from a performance perspective, a semiconductor-focused strategy is appropriate. Based on 12-month forward operating profit, semiconductors have accounted for about 97% of the increase in KOSPI earnings since the beginning of the year, which supports the strategy of expanding the weighting of leading stocks such as semiconductors."

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