[Good Morning Market] US Gains on Semiconductor Rally... Korea Also Expected to Rise

Renewed Optimism for Micron and SanDisk Despite Middle East Tensions

Despite ongoing conflicts in the Middle East, the U.S. stock market closed higher, and the Korean stock market is also expected to show gains, led by strong performances in major sectors such as semiconductors.

On the 21st (local time), the Dow Jones Industrial Average closed at 52,224.64, up 0.74% from the previous trading day on the New York Stock Exchange. The S&P 500 rose by 0.89% to close at 7,509.20, while the tech-heavy Nasdaq Composite ended at 25,837.21, up 1.29%.

On that day, the U.S. stock market closed higher despite ongoing uncertainties, including escalating tensions between the U.S. and Iran around the Strait of Hormuz and the announcement of a blockade in the Red Sea by Yemen's Houthi rebels. This upward trend was driven by strong earnings from major companies like General Motors (GM) and 3M, as well as renewed optimism in semiconductor stocks such as Micron and SanDisk. The market expects further escalation is unlikely, considering factors like ceasefire proposals from mediating countries and ongoing diplomatic channels among the parties involved.

On the 21st, employees at the dealing room of Hana Bank's headquarters in Jung-gu, Seoul, are monitoring the stock market and exchange rates. On that day, the KOSPI opened at 6553.88, up 0.58% from the previous trading day, but has been showing mixed trends with fluctuations. July 21, 2026 Photo by Jo Yongjun

The direction of stock prices will likely be determined by Alphabet's earnings event, scheduled for release after the U.S. market closes tomorrow. Han Ji-young, a researcher at Kiwoom Securities, stated, "This Alphabet earnings report will be the first event to reassess the visibility of demand for artificial intelligence (AI)." Key factors will include this year's capital expenditure (CAPEX) guidance, indications of further investment expansion next year, and whether the cloud business continues its strong growth.

The domestic stock market is expected to trend upward. Contributing factors include a sharp rise in U.S. semiconductor stocks, a more than 4% gain in KOSPI200 overnight futures, and expectations for the second quarter earnings season for Korean automakers, banks, and other sectors. Additionally, improved foreign inflows further support this positive outlook. Foreign investors have been net buyers of KOSPI for two consecutive weeks starting last week. For the semiconductor sector, they also turned net buyers for the first time in 12 weeks, with a net purchase of 900 billion won this week. The MSCI Korea ETF (EWY) saw record-high weekly inflows of approximately 4.4 trillion won last week.

However, there are concerns that intraday volatility may increase. One researcher noted, "The volatility index (VKOSPI) reached a high 84 points as of the previous day, and a surge in leveraged trading of individual stocks could heighten pressures for increased intraday volatility."

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