Last week was a rebound for the domestic stock market, which had been shaken by the first tax reform plan of the Lee Jae-myung government. The KOSPI index started at 3114.27 from August 4th to 8th and once again recovered the 3200 mark. The KOSDAQ index began at 773.83 and showed an upward trend for five consecutive trading days, reclaiming the 800 barrier.
Although the market did not continue to decline, it is expected that this week (August 11th to 15th) will also be heavily influenced by the news. As the government and the Democratic Party of Korea are scheduled to hold a high-level government-party council on the 10th, it remains to be seen whether the alternatives anticipated by the market will emerge.
The uncertainty over tariffs from the Donald Trump administration in the United States remains. President Trump said he would impose a 100% tariff on semiconductors produced outside the U.S., while indicating that companies that have built or are in the process of building semiconductor manufacturing plants in the U.S. would be exempt.
There is growing hope that Samsung Electronics and SK hynix will be exempt from tariffs on semiconductor items. The issue is that President Trump's 'position' could change at any time. This is why it is important to scrutinize the details of tariffs expected to be disclosed this week on semiconductors and pharmaceuticals.
Kang Jin-hyuk, a researcher at Shinhan Investment & Securities, said, 'The details of tariffs on specific semiconductor and pharmaceutical items are expected to be disclosed, leading to short-term volatility.'
The grace period for tariffs between the United States and China may end on the 12th, Korean time. Earlier, following the results of the third high-level trade negotiations held in Stockholm, Sweden, the working-level officials from the United States and China tentatively agreed to extend the tariff grace period by about 90 days. However, President Trump has not yet approved this.
On the same day, the U.S. Consumer Price Index (CPI) for July will also be released. The market expects it to have risen by 2.8% compared to the previous year. If this happens, it would indicate an increase in prices after the tariff policy, following a low of 2.3% in April, 2.4% in May, and 2.7% in June.
The Federal Reserve's concerns regarding the timing of interest rate cuts are bound to deepen. In particular, as U.S. employment indicators have come out weaker than expected, causing fluctuations in the global stock market, there are expectations of interest rate cuts at the upcoming Federal Open Market Committee (FOMC) regular meeting in September, which could lead to increased volatility again.
The summit between President Trump and Russian President Vladimir Putin is scheduled to be held on the 15th in Alaska, local time. President Trump has pressured that he would impose high tariffs on Russia if it does not agree to a ceasefire in Ukraine. The key will be whether the summit leads to a de-escalation of the standoff and a resolution to the Russia-Ukraine war.
In the market, stocks of construction machinery companies, often cited as 'beneficiaries of the Ukraine reconstruction project', surged, while the defense sector showed weakness.
Given the variety of external risks, securities firms advised focusing on 'favorable news'. The sectors benefiting from the visa-free entry policy for Chinese group tourists are representative.
Na Jeong-hwan, a researcher at NH Investment & Securities, noted, 'While external risk factors exist, the stock price momentum from the visa-free policy for Chinese group tourists is still rooted in domestic consumption and tourism specialties,' suggesting food and beverages, cosmetics, domestic industries and duty-free, casinos, and entertainment as sectors of interest.
The earnings report of corporations for the second quarter (April to June) will also follow. Given that stock prices often fluctuate greatly after earnings announcements, it is important to pay attention.
Major corporations announcing earnings this week include ▲SHIFT UP and KT on the 11th ▲NCSOFT and CJ CheilJedang on the 12th ▲Samsung Life Insurance, Samsung Fire & Marine Insurance, Hanwha Life, Meriz Financial Group, and JYP Entertainment on the 13th ▲LG, DB Insurance, and Mirae Asset Life Insurance on the 14th.