[Edaily Reporter Kwon Oh Seok ] The domestic stock market, which has experienced sharp volatility due to external geopolitical uncertainties—such as the resumption of military clashes between the U.S. and Iran—and monetary policy concerns, is expected to reach a turning point next week (September 7–11). Market attention is focused on the release of the U.S. August Consumer Price Index (CPI) and Producer Price Index (PPI), among other factors.

Last week, the KOSPI was severely shaken by the escalation of military tensions between the U.S. and Iran. As the U.S. struck a missile launch site on Iran’s Larak Island and Iran launched retaliatory airstrikes, West Texas Intermediate (WTI) crude oil prices surged past $90 per barrel, reigniting inflation fears. Consequently, the yield on the 10-year U.S. Treasury note rose to around 4.8%, significantly dampening risk appetite.

However, the mood reversed toward the end of the week as Fed officials, including Federal Reserve Governor Christopher Waller and New York Fed President John Williams, made a series of dovish (monetary easing-oriented) remarks. As expectations for a rate freeze in September recovered and volatility subsided—with the VKOSPI (KOSPI 200 Volatility Index) falling below 40 points—the market rebounded, led by major semiconductor stocks such as SamsungElectronics(005930)and SK hynix(000660). On the last trading day of the week (the 4th), the index closed at 6,687.21, up 107.73 points (1.64%) from the previous session.

Securities analysts note that, despite external headwinds, the fundamentals and earnings momentum of the domestic stock market remain solid. South Korea’s August exports surged 68.7% year-over-year to $98.25 billion, with semiconductor exports in particular soaring 209% year-over-year, driving earnings momentum. Currently, the KOSPI’s 12-month forward P/E ratio stands at around 5x, placing it in an extremely undervalued range; a rebound is expected as valuations normalize once interest rates stabilize.

Looking ahead to next week, inflation data released ahead of the FOMC (Federal Open Market Committee) meeting scheduled for September 15–16 is expected to be a key factor in gauging the monetary policy stance. U.S. August PPI data is scheduled for release on the 10th, and CPI data on the 11th.

Kwon Soon-ho, an analyst at DaishinSecurities, stated, “As the Fed emphasizes its commitment to price stability, August CPI and core CPI are highly likely to show signs of slowing, and we expect core CPI to rise 2.38% year-over-year, setting a new low for the year.”

He added, “We expect the Fed to keep the benchmark interest rate unchanged at the September FOMC meeting. If Treasury yields stabilize as the consensus for future rate hikes converges toward zero, this will serve as a factor strengthening the stock market’s rebound momentum.”

Experts recommend maintaining an increased weighting in the semiconductor sector—which accounts for a significant portion of the KOSPI’s net profits—while also incorporating leading and beneficiary sectors where upward momentum could spread.

Na Jeong-hwan, an analyst at NH INVESTMENT & SECURITIES, explained, “We are now in a phase where stock price volatility has clearly retreated from its peak; even with solid semiconductor fundamentals, it is unlikely that we will see a repeat of the consecutive sharp rallies seen last June. It is necessary to maintain an increased allocation to semiconductors.” He projected a weekly trading range for the KOSPI of 6,200 to 7,300.

He added, “Semiconductors account for over 70% of the KOSPI’s net profits, and the growth rate of semiconductor exports is also on an upward trend,” but noted, “If upward momentum slows, investors will seek sectors with greater upside potential. Ultimately, a strategy centered on semiconductors while also including sectors that stand to benefit from the broader trend is effective. I recommend secondary batteries and AI platforms and services.”