The domestic stock market is expected to face downward pressure due to rising long-term U.S. Treasury yields and weakness in the New York stock market. The KOSPI dropped more than 2% the previous day, reflecting external negative factors, and volatility is anticipated as quarter-end rebalancing and oversold conditions come into play.
On September 28, all three major U.S. stock indices fell. The Dow Jones Industrial Average closed down 0.67% at 51,481.51. The S&P 500 index fell 0.77% to 7,683.69, while the Nasdaq Composite dropped 0.92% to 26,820.38.
Ongoing tensions between the U.S. and Iran have led to a rise in both international oil prices and U.S. Treasury yields, dampening investor sentiment. The yield on the 10-year Treasury note surpassed 5.27% during trading, closing at 5.241%, the highest level since June 2007. The 30-year yield also rose to 5.561%.
International oil prices surged more than 4% during the day but later retraced most of the gains as the possibility of dialogue between the U.S. and Iran emerged. Brent crude for November delivery ended up 0.92% at $105.28 per barrel, while West Texas Intermediate (WTI) rose 0.21% to $92.60.
The pressure from rising rates has also affected investor sentiment in technology stocks. The Philadelphia Semiconductor Index fell 1.61%. However, Nvidia's announcement of a $150 billion stock buyback plan helped limit the index's decline, with shares rising 1.68%.
Domestic market indicators were generally weak. The MSCI Korea ETF fell 1.92%, and the MSCI Emerging Markets ETF dropped 1.15%. KOSPI night futures also declined by 0.3%. In pre-market trading on NextTrade, as of 8:13 a.m. on the 29th, Samsung Electronics (-0.56%), SK Square (-0.45%), and Hyundai Motor (-0.42%) showed weakness, while SK Hynix (0.17%) and Samsung Electro-Mechanics (0.73%) were up.
Seo Sang-young, a researcher at Mirae Asset Securities, noted, "International oil prices initially rose over 4% due to instability between the U.S. and Iran, but most of the gains were given back as dialogue possibilities emerged. Treasury yields remained high despite the reduced rise in oil prices, influenced by global fiscal instability and the yen carry issue."
He added, "The domestic market may face pressure from rate concerns and quarter-end rebalancing, but given the sharp drop the previous day, there is also a need to pay attention to the potential for a rebound due to oversold conditions."
Today, the domestic market is expected to be influenced by movements in U.S. long-term rates and foreign investor sentiment. In particular, the ability of semiconductor stocks, which fell sharply the previous day, to absorb the weakness in the Philadelphia Semiconductor Index and rebound will likely be a key variable in market trends.
* This article has been translated by AI.
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