Will Samsung Electronics fall in Nvidia’s wake? Watch for a sharp reversal in the FX trend [Market Preview]

Attention is on whether the KOSPI, which for the first time ever has crossed the 4,700 threshold, can extend its rally. A broad selloff in tech shares led by Nvidia in the New York market is being flagged as a negative.

According to the Korea Exchange on the 15th, the KOSPI finished the previous session up 0.65% at 4,723.1. Individuals and foreigners net sold KRW 437.7 billion and KRW 376.0 billion, respectively, but institutions net bought KRW 588.7 billion, lifting the index.

Samsung Electronics and SK hynix rose 1.96% and 0.54%, respectively. Hanwha Corp surged 25.37% after carrying out a spin-off to address the holding-company discount. The KOSDAQ fell 0.72% to close at 942.18.

U.S. stocks fell broadly on the 14th (local time), led by tech. The Dow Jones Industrial Average slipped 0.09%, the S&P 500 fell 0.53%, and the Nasdaq Composite dropped 1%.

As reports said China recently ordered a customs ban on Nvidia’s artificial intelligence (AI) chips, which had become exportable to China again, weakness in large-cap tech stocks—centered on semiconductor names—dragged the broader market lower. Nvidia (-1.4%), Micron (-1.4%) and Citigroup (-3.3%) declined. Uncertainty was also seen as rising on the possibility of U.S. military intervention amid spreading bloodshed in Iran.

Analysts say the domestic market may enter a consolidation phase. Han Ji-young, a researcher at Kiwoom Securities, said, “It’s a rotational market in which different sectors take turns driving the index to new levels,” adding, “Another round of sector rotation is likely, and the overall index appears set to take a breather.”

Another point to watch was U.S. Treasury Secretary Scott Bessent’s comment overnight that “the recent depreciation of the won does not square with Korea’s strong economic fundamentals.” On the news, the won-dollar exchange rate plunged by more than 10 won, from the 1,470-won range to the low 1,460s. If expectations build for won appreciation, foreign investors seeking FX gains could increase inflows into Korean equities.

The researcher said, “The key is how much the sharp drop in the exchange rate will change foreign investors’ trading patterns, after they recorded net selling of KRW 1 trillion in the KOSPI market this week.”

By Maeng Jin-gyu maeng@hankyung.com