South Korea's stock market is set to open higher on the last trading day before the Chuseok holiday, lifted by gains in major chipmakers including Samsung Electronics (005930.KS) and SK hynix (000660.KS).
Samsung Electronics traded at 283,000 won as of 8:15 a.m. on the 23rd in the premarket session, which runs from 8 a.m. to 8:50 a.m., up 2.35% from its previous regular-session close of 276,500 won, according to Nextrade. SK hynix was quoted at 1.897 million won at the same time, up 3.1% from 1.84 million won the previous day. The 579 stocks traded in the premarket session posted an average gain of 1.85%.
The KOSPI is expected to face upward pressure on strength in U.S. technology shares and hopes for easing tensions in the Middle East. The three major New York indexes closed mixed overnight, but artificial intelligence and semiconductor shares rallied. Nvidia rose 0.66% and Micron Technology gained 5.00%, lifting the Philadelphia Semiconductor Index 2.06%. The MSCI Korea exchange-traded fund, a gauge of investor sentiment toward the Korean market, also rose 1.83%.
Oil prices extended their decline after reports that Iran had proposed reopening the Strait of Hormuz within seven days in exchange for an easing of U.S. military pressure. Brent crude for November delivery and West Texas Intermediate for October delivery both fell more than 1%, settling below $100 a barrel.
The KOSPI rose early in the previous session on strength in U.S. semiconductor shares but pared its gains later in the day. Analysts said the market could pause on some profit-taking ahead of the Chuseok holiday but advised against reducing equity holdings.
"The domestic market is expected to open higher, led by semiconductors, on the back of a 2% gain in the Philadelphia Semiconductor Index and a 2% rise in KOSPI 200 night futures," said Han Ji-young, an analyst at Kiwoom Securities. "During the session, the index will face profit-taking pressure amid a wait-and-see mood ahead of the holiday, capping the upside and shifting the market toward individual stock moves driven by company-specific issues."
"Short-term volatility from pre-holiday caution and profit-taking should be used as an opportunity to add exposure," said Lee Kyoung-min, an analyst at Daishin Securities. "The 7,600 level, which corresponds to a 12-month forward price-to-earnings ratio of six times for the KOSPI, is the first rebound target."
