The KOSPI index stepped onto an unprecedented 3,610 level. On 10th, the only trading day last week, the KOSPI rose to 3,617.86 on the back of foreign buying, setting a new all-time high. The "semiconductor rally" lifted the stock index. Shares of Samsung Electronics and SK hynix, the No. 1 and No. 2 by market capitalization on the KOSPI, both hit fresh record highs.
This week (Oct. 13–17), market sentiment is also expected to be swayed by the semiconductor rally. Investor attention is focused especially on third-quarter earnings announcements by domestic and overseas semiconductor corporations.
Samsung Electronics' earnings announcement could be a turning point. Samsung Electronics will release its preliminary results for the third quarter of this year (July–September) on Oct. 14. The market sees this release as a gauge to confirm the recent securities industry outlook calling for a memory semiconductor supercycle (a prolonged boom).
According to FnGuide on 12th, the third-quarter earnings consensus for Samsung Electronics (the three-month average of securities firms' estimates) as of 10th is sales of 83.8252 trillion won and operating profit of 9.8997 trillion won, estimated to be up 6% and 8%, respectively, from a year earlier.
Park Seok-hyun, an economist at Woori Bank, said, "Even if Samsung Electronics' third-quarter results only meet expectations, the outlook for strong results in the fourth quarter and next year stands out," adding, "The share price rise will continue."
Attention should also be paid to earnings announcements by global semiconductor corporations ASML and TSMC this week. ASML will report third-quarter results on 15th, and TSMC on 16th, which can confirm the momentum in the semiconductor sector.
Kang Jin-hyeok, an analyst at Shinhan Investment & Securities, said, "In a situation mixing confidence in artificial intelligence (AI) and an economic slowdown, we need to see through earnings releases by semiconductor corporations such as ASML and TSMC whether the strength in tech stocks will extend, and whether Samsung Electronics' earnings rebound is also important."
In addition, overseas financials are set to release results in large numbers. On 14th, JPMorgan, Wells Fargo, Goldman Sachs, and Citigroup will report, followed by Bank of America and Morgan Stanley on 15th.
With a "shutdown" partially halting federal government functions amid a standoff between U.S. Republicans and Democrats, experts see 15th as the watershed for a prolonged U.S. federal government shutdown. The 15th is payday for active-duty U.S. service members and other federal employees. Lee Kyung-min, a researcher at DAISHIN SECURITIES, said, "If the shutdown continues beyond that date, it could affect expectations for additional rate cuts by the U.S. Federal Reserve," adding, "A federal government shutdown could become a situation that affects the U.S. economy, consumption, and employment."
Also on 15th, the U.S. consumer price index (CPI) for September is due, and on 16th, the September U.S. producer price index (PPI) and retail sales indicators are scheduled for release. As the last inflation indicators before the October Federal Open Market Committee (FOMC), market interest is high, but if the shutdown is prolonged, the releases could be delayed.
Meanwhile, the won-dollar exchange rate has surged into the 1,420-won range, acting as a risk factor for the stock market. With renewed strength in the U.S. dollar index amid Europe's political uncertainty and a weak Japanese yen, the won is struggling due to difficulties in the South Korea–U.S. tariff negotiations.
Kim Jae-seung, an analyst at Hyundai Motor Securities, said, "From a dollar supply-and-demand perspective, the won may weaken, but it is hard to see this as a new negative for the stock market," adding, "Uncertainty has increased, but we judge that the impact of expanding global liquidity and the AI bull market on the KOSPI index will be stronger."
However, he added, "Difficulties in the South Korea–U.S. tariff negotiations and a weaker won will widen sectoral divergences within the KOSPI," adding, "We expect continued strength in export stocks in sheltered areas of protectionism that the United States wants from Korea, such as semiconductors, power, and shipbuilding."