U.S. stock markets continue to reach record highs, buoyed by easing geopolitical risks in the Middle East and a surge in artificial intelligence (AI) stocks, raising questions about the sustainability of the domestic market's upward trend. However, with the KOSPI already at historic highs, there are concerns about potential profit-taking in the short term.
On May 28, the S&P 500 and Nasdaq Composite indices rose by 0.58% and 0.91%, respectively, setting new all-time highs. The Dow Jones Industrial Average also gained 0.05%, closing slightly higher.
The market rally was driven by optimism surrounding the easing of tensions in the Middle East. Reports indicated that the U.S. and Iran are finalizing a memorandum of understanding (MOU) to end hostilities, pending final approval from President Donald Trump, which improved investor sentiment.
AI stocks also showed strong performance. Snowflake, a cloud data company, saw its shares soar by 36.48% after raising its annual revenue forecast and securing a long-term contract with Amazon Web Services (AWS). This led to gains in major semiconductor stocks, including Nvidia (up 0.78%) and AMD (up 4.55%), while the Philadelphia Semiconductor Index rose by 1%.
The domestic market is expected to open higher, following the positive momentum from U.S. tech stocks, particularly in the semiconductor sector. Notably, after the U.S. market closed, Dell Technologies reported earnings that exceeded market expectations, causing its stock to surge over 38% in after-hours trading, which is likely to positively influence investor sentiment in the domestic semiconductor industry.
As of 8:03 a.m. on May 29, shares of Samsung Electronics were trading at 307,000 won, up 2.5% from the previous day, while SK Hynix rose 3.41% to 2,367,000 won. Additionally, SK Square increased by 3.07%, and Samsung Electro-Mechanics gained 6%, indicating a broad buying trend across semiconductor and AI-related stocks.
Han Ji-young, a researcher at Kiwoom Securities, stated, "Today, the domestic market is expected to rebound due to renewed expectations surrounding U.S.-Iran negotiations, the strong performance of KOSPI 200 futures, and the impact of Dell's after-hours stock surge, which will bolster recovery in sectors that experienced significant declines yesterday. However, the recent rapid rise of the KOSPI to historic highs raises concerns about a potential slowdown in upward momentum. Market participants will closely monitor foreign investor activity and profit-taking as key factors influencing the market's direction in the coming days."
* This article has been translated by AI.
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