KOSPI Flat on Prospect of U.S. Fed Jumbo Rate Hike; KOSDAQ Up in the 3% Range [fn Morning Market Report]

[Financial News] With the possibility of a U.S. interest rate hike coming into focus, the KOSPI was trading nearly flat on the morning of the 11th.
As of 9:36 a.m., the KOSPI stood at 5,248.06, down 24.36 points (0.46%) from the previous day. It opened at 5,209.71, down 29.42 points (0.56%) from the previous session, and has since fluctuated around the flat line.
Foreign investors, who turned to net buying in the main board the previous day and helped lift the index, were net sellers again in early trading. Foreign investors currently have a net selling position of 94.8 billion won. Institutions are net sellers of 8 billion won, while individual investors are net buyers of 45.4 billion won.
Among individual stocks, Samsung Electronics was trading at 196,900 won, down 1.01% from the previous day, at the same time. SK hynix was trading at 1,195,000 won, down 1.40%.
Among the largest stocks by market capitalization, LG Energy Solution (1.36%), Naver (1.92%) and Celltrion (5.67%) were higher.
SK Square (-2.50%), Hyundai Motor Company (-1.09%) and Samsung Electro-Mechanics (-2.05%) were among the decliners.
Meanwhile, the KOSDAQ was up 21.19 points (3.16%) at 688.71, buoyed by strength in materials, parts and equipment stocks and secondary batteries.
The index opened at 668.48, up 0.87 points (0.13%), and has since extended its gains.
On the KOSDAQ, foreign investors and institutions were net buyers of 15.2 billion won and 20.2 billion won, respectively. Individual investors were net sellers of 35.8 billion won.
Many of the KOSDAQ's largest stocks by market capitalization were higher, including Alteogen (3.40%), EcoPro (8.23%) and Jusung Engineering (8.34%).
Meanwhile, all three major U.S. stock indexes fell overnight in New York after the U.S. Consumer Price Index (CPI) for October came in above market expectations, bringing the possibility of an interest rate hike into focus.
The Dow Jones Industrial Average fell 0.30%, while the S&P 500 and Nasdaq Composite declined 0.38% and 0.74%, respectively.
The U.S. CPI rose 0.4% in October from the previous month, while core CPI, which excludes energy and food prices, rose 0.3%. Both figures were 0.1 percentage point above market expectations. Stronger-than-expected inflationary pressure bolstered expectations of tighter monetary policy.
In particular, before the CPI release, Federal Reserve Governor Christopher Waller said, “If core CPI inflation comes in around 0.3% or higher, stronger policy action may be needed,” and raised the possibility of a 50-basis-point “jumbo” rate hike. This appears to have weighed on investor sentiment.
The yield on the U.S. 10-year Treasury note at one point topped 5% during the session.
However, analysts in the securities industry believe an actual jumbo rate hike is unlikely.
Han Ji-young, a researcher at KIWOOM Securities, said, “It is worth noting that a 50-basis-point hike in December is a minority view. It is also worth noting that international oil prices, which had fueled broad-based inflation in the U.S. across areas such as energy and services, once topped $100 but have recently fallen to the mid-$80s amid hopes for U.S.-Iran talks.”
Han Ji-young added that “the domestic stock market is expected to give back some of the previous day’s gains,” but analyzed that “given that the impact of the U.S. October CPI was limited—as the Philadelphia Semiconductor Index narrowed its losses during the previous session from around 2% to around 0.4%—the domestic market is also expected to show resilience against downward pressure during the session.”
[email protected] Joo Won-gyu Reporter