Israeli media reported that the U.S. and Iran are expected to announce a month-long ceasefire soon. The New York Times, a leading American newspaper, also reported that the U.S. has sent a peace plan to Iran to end the war, causing South Korean stock markets to rise.
As of 8:14 a.m. (Korean time) on Wednesday, pre-market trading for 628 stocks on NextTrade shows an increase of 1.31%.
Samsung Electronics has risen by 1.11%, while SK Hynix is up 1.32%.
Today, SK Hynix announced that it had confidentially submitted a registration statement (Form F-1) to the U.S. Securities and Exchange Commission (SEC) for its American Depositary Receipts (ADRs). This news led to a more than 3% increase in pre-market trading, pushing the stock price above 100 million KRW (about 66,700 USD) per share.
Hyundai Motor rose by 1.63%, LG Energy Solution by 0.89%, SK Square by 1.68%, and Doosan Enerbility by 1.40%.
However, Hanwha Aerospace, a defense stock, experienced a slight decline of 0.22% amid expectations for an end to the war.
In the KOSDAQ sector, Samchundang Pharm surged by 13.14%.
Following the announcement regarding Chief Executive Officer (CEO) Jeon In-seok’s partial sale of shares, which the company described as an unavoidable decision for lawful and transparent tax compliance, investor sentiment appears to have improved.
Overnight, the New York stock market closed lower due to concerns over the prolonged conflict in the Middle East and rising interest rates.
On Tuesday, the S&P 500 index finished down 0.37% at 6,556.37. The Nasdaq index dropped 0.84% to 21,761.89, while the Dow Jones Industrial Average fell 0.18% to 46,124.06.
However, after the U.S. market closed, major media outlets like the New York Times reported that the U.S. proposed a one-month ceasefire with 15 conditions, which shifted market sentiment positively once again.
The U.S. conditions include: dismantling nuclear capabilities, a commitment not to pursue nuclear weapons, maintaining open access to the Strait of Hormuz, and granting monitoring authority to the International Atomic Energy Agency (IAEA). If Iran accepts these terms, it is expected to receive full lifting of international sanctions and support for the development of its civilian nuclear program.
Although neither country has officially stated its position, the emergence of a detailed exit strategy appears to be positively influencing the stock market.
Following news of the U.S. negotiation proposal, West Texas Intermediate (WTI) crude oil, which had re-entered the 94 USD range during trading, plummeted to the 88 USD range after the market closed. Nasdaq futures also rose nearly 1% in after-hours trading.
Han Ji-young, an analyst at Kiwoom Securities, noted that currently, the U.S. Nasdaq has broken below its long-term trend line, the 200-day moving average, while the KOSPI is frequently dipping below its short-term trend line, the 20-day moving average. The KOSPI’s volatility, with a more than 4% surge followed by a reversal during the day, suggests that market participants are engaged in a tug-of-war regarding short-term stock direction.
She continued that while the market direction is ambiguous from a technical standpoint, it believes the medium-term upward outlook remains valid. Even amidst the volatility caused by the aftermath of the war, it is appropriate to maintain a neutral or above allocation in domestic stocks.
