US presidential election and FOMC event end… Uncertainty resolution section[주간증시전망]

[서울=뉴시스] Reporter Bae Yo-han = This week, the domestic stock market is expected to create a positive investment environment by resolving uncertainty as it digests all major events such as the U.S. presidential election and the Federal Open Market Committee (FOMC) meeting. In addition, there are observations that domestic and foreign financial risks have been greatly alleviated with the abolition of the financial investment income tax, which had weighed down investment sentiment in the domestic stock market.

According to the Korea Exchange on the 10th, last week (November 4-8) KOSPI closed trading at 2561.15, up 18.79 points (0.73%) from the previous week. During this period, institutions alone made net purchases of KRW 335.2 billion in the stock market, while individuals and foreigners net sold KRW 338.4 billion and KRW 130.3 billion, respectively.

The indicator to pay attention to this week is the release of the US consumer price index (CPI) for October. However, the prevailing view is that the impact on the market will not be significant as the sensitivity to prices has decreased as the Federal Reserve (Fed) has cut interest rates for the second consecutive time.

This week, you should pay attention to speeches by Federal Reserve members that will provide a glimpse into the outlook for the interest rate cut policy. Federal Reserve Board Director Michelle Bowman (9th), Minneapolis Fed President Neel Kashkari (13th), Federal Reserve Chairman Jerome Powell (15th), and New York Fed President John Williams (15th) are scheduled to speak.

The securities industry analyzed that with the U.S. stock market hitting an all-time high due to Trump’s election, the risks associated with the country-first policy could act as a burden on the domestic stock market. Accordingly, the advice is that investors should keep in mind the decoupling of the Korean-US stock market and make investments focusing on industries and individual companies.

Park Seung-young, a researcher at Hanwha Investment & Securities, explained, “As the path of monetary policy becomes clear, the remaining uncertainty is Trump’s trade policy,” adding, “Implementing universal tariffs could reduce trade and stimulate prices.”

Kim Young-hwan, a researcher at NH Investment & Securities, said, “With the U.S. Republican Party winning a landslide victory in the election, the United States in the Trump 2.0 era is expected to pursue a strong national-first policy,” adding, “This is a burden for Korea’s major export companies, led by semiconductors.”

He continued, “The existing policy environment may change significantly, such as easing the Dodd-Frank Act and revising the Inflation Reduction Act (IRA),” and added, “The imposition of a 10% universal tariff on all US-bound imports may be highlighted as a risk in the domestic stock market.” “He pointed out.

Researcher Kim recommended industries such as defense, shipbuilding, pharmaceuticals/bio, entertainment, food and beverages, and cosmetics, saying that it is necessary to pay attention to stocks that benefited from Trump’s policy and China’s economic stimulus.

There is also a view that a full-fledged rebound in the domestic stock market is expected.

Kyeong-min Lee, a researcher at Daishin Securities, said, “Since August, KOSPI has underperformed compared to the global stock market, and the 12-month forward price-to-earnings ratio (PER) remains at 8.7 times, so we expect a strong turnaround.” The stock market is experiencing a resilient rebound due to improved supply and demand for foreigners based on November supply and demand seasonality (foreign futures purchases and program purchases), bond interest rates, and the downward stabilization of the dollar. “It is expected,” he said.

He added, “The semiconductor, automobile, secondary battery, and internet industries, which are undervalued industries relative to their performance and showed a sharp decline immediately after Trump’s election, will lead the way for KOSPI to break the 2,600 mark.”

◇Announcement of major economic indicators and event schedule

▲12th = U.S. October NFIB small business optimism index / Japan October machine tool orders

▲13th = US October Consumer Price Index (CPI) / Korea October unemployment rate

▲14th = US October producer price index (PPI) / Europe 3rd quarter gross domestic product (GDP)

▲15th = US October retail sales, October industrial production, November New York Fed manufacturing index / China October industrial production, October retail sales / Japan 3rd quarter GDP
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