Kospi, Shaken by US ‘Blue Wave’ Shock, Eyes Rebound as NH Sees 5,000-6,000 This Week

NH Sees Kospi at 5,000-6,000 This Week

Investors are watching whether the Kospi can rebound this week, from Nov. 9 to Nov. 13, after being jolted by a U.S. “blue wave” shock, or a Democratic sweep. Brokerages say fears of a pullback in artificial intelligence investment have become excessive and that South Korea’s stock market may try to recover.

According to the financial investment industry on Nov. 8, NH Investment & Securities projected the Kospi would trade in a 5,000-6,000 range this week. It cited easing concerns over AI data-center regulation and lower U.S.-Iran war risk, which could help stabilize interest rates, as upside factors. Foreign investor outflows were identified as a downside risk.

Na Jung-hwan, an analyst at the brokerage, said concerns about tighter U.S. data-center regulation under a Democratic blue wave had driven a sharp drop in South Korean semiconductor stocks. But he added that AI data-center construction and memory demand should remain solid.

Democrats also support competing with China for AI leadership, limiting their incentive to fundamentally block construction of the data centers that underpin AI development, Na said. He added that the regulatory focus is less on banning construction than on easing residents’ cost burdens. Some states are pursuing policies that raise some data-center charges while lowering others.

Easing U.S.-Iran war risk is another point to watch. Na said that if Democratic leaders intensify calls for a swift end to the conflict with Iran, war-related risks could ease from current levels. If international oil prices fall and recently surging U.S. Treasury yields stabilize lower, concerns over AI companies’ fundraising capacity and negative free cash flow could also ease somewhat.

CoreWeave’s third-quarter earnings report, due this week, could mark a key turning point in whether sentiment toward AI investment recovers. Lee Kyung-min, an analyst at Daishin Securities, said that if the U.S. neocloud company’s AI spending plans and financing capacity are confirmed, it could help revive sentiment toward semiconductor investment. If debt burdens come back into focus or investment plans are revised down, however, pressure for an additional correction across the AI value chain could increase.

The U.S. consumer price index and producer price index for October will also help determine whether macroeconomic pressure is easing. Lee said hotter-than-expected inflation could raise the possibility of an additional Federal Reserve rate increase and weigh on equities. If inflation is shown to be cooling, more stable rates could support a rebound led by oversold growth stocks.

Still, the planned initial public offering of Anthropic, which owns the AI model Claude, remains a concern because it could trigger foreign investor outflows. Anthropic is aiming for a Nasdaq listing before Thanksgiving on Nov. 26. The deal is projected at around $100 billion, exceeding SpaceX’s $75 billion in June and potentially becoming the largest IPO on record.

Na said the global reallocation of funds could weigh on trading flows into South Korean semiconductor shares. But he added that foreign investors turned to net buyers on the day SpaceX listed, suggesting the flow burden could ease after the offering schedule is completed.

Lee Su, Hankyung.com reporter 2su@hankyung.com