[Market ING] KOSPI Expected to Attempt Rebound Amid Heightened Caution Ahead of Holiday

Weekly KOSPI Projection: Expected Range of 6,400 to 7,500

Last week, the KOSPI exhibited a “weak-open, strong-close” pattern, finishing the week around the 6,800 level. This week, market sentiment is expected to become more cautious ahead of the Chuseok holiday.

Yonhap News Agency

Last week, the KOSPI declined by 0.23%, while the KOSDAQ rose by 0.79%. Lim Jeongeun, a researcher at KB Securities, commented, “On the 18th, the domestic stock market was boosted by strength in major semiconductor stocks, which led the KOSPI’s gains. Foreign investors shifted to a net-buying position for the first time in eight trading days, and institutions also joined in as net buyers. However, some of the gains were given up during the latter part of the session, and the KOSPI ultimately failed to reclaim the 6,900 level.” She added, “On a weekly basis, the KOSPI and KOSDAQ recorded returns of roughly -0.2% and 0.7%, respectively. As key monetary policy events in major economies played out, related uncertainties were somewhat alleviated.”

Despite interest rate hikes by the US and Japan, global equity markets have remained resilient, though it is noted that volatility could increase in the short term. Paek Jongmin, a researcher at Samsung Securities, stated, “Global asset markets are digesting recent monetary policy events. Even with significant rate hikes from the US Federal Open Market Committee (FOMC) in September and the Bank of Japan (BOJ), the market viewed these moves not as a tightening shock, but as a resolution of uncertainties, allowing the solid trend to continue.” He added, “While in the short term, the pace of global liquidity expansion is slowing and geopolitical uncertainties persist—factors that could lead to greater volatility in the indices—the current phase calls more for preparing for potential upside risks ahead rather than succumbing to downside fears.”

While caution is likely to intensify ahead of the market closure for the Chuseok holiday this week, the increased volatility before the holiday is analyzed as an opportunity to expand exposure. Lee Kyungmin, a researcher at Daishin Securities, said, “After the hawkish (pro-tightening) September FOMC meeting, bond yields have actually stabilized, as uncertainty over US monetary policy was already priced in.” He continued, “For the time being, attempts at a rebound, underpinned by stable oil prices and bond yields, will likely continue.” He further commented, “However, in Korea, as caution grows ahead of the Chuseok holiday, there is a possibility of some profit-taking, but the expansion of volatility before the holiday should be seen as an opportunity to increase exposure.”

Na Junghwan, a researcher at NH Investment & Securities, said, “If US long-term bond yields reverse course while domestic corporate earnings remain solid, stock prices are likely to push the upper end of the trading range higher as valuations normalize.” NH Investment & Securities presented this week’s expected KOSPI range at 6,400 to 7,500.

The key events scheduled for this week include the announcement of Korea’s export data for September 1–20 on the 21st, as well as the US Richmond Federal Reserve’s Manufacturing Index on the 22nd. On the 23rd, the US September S&P Global Manufacturing and Services Purchasing Managers’ Indexes (PMI) will be released, followed by the US August Durable Goods Orders on the 25th.

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