Time now for an in-depth look at the market news this afternoon.
And for that I'm joined on the line by Mr. Daniel Yoo, global strategist at Yuanta Securities.
Mr. Yoo, thanks for coming on today.
Thank you.
Third quarter earnings are coming in on Wall Street. Some big companies came in lower than expected, but stock were up overall. What's the story in the global markets today?
Despite the concern of brexit uncertainty, market was pretty much flat.
Teslar soared 21%. Most of geopolitical risk was won over by earnings results release in US as well as US China trade negotiation going in right direction.
Asian market mixed. Korea down by slightly, Japan up half a percent. China down by 1/4 percent.
Meanwhile the KOSPI turned lower today. A lot of foreign investors buying back in though. What's happening in Korean stocks today, and what areas stand out to you?
Interest rate cut 2 times. Will follow what US Fed does in terms of rate cut.
Supplementary budget expected. Government debt to GDP only 40% level for Korea
Sector we are keen on is still IT and Bio. Korea Japan trade war is putting pressure on Korea, but cost level is higher for Korea, but it will substitute quickly of Japanese supply. Numbers of Japan is not looking good. Dispute should settle. Margin pressure for Korean company is expected, but longer term prospect is still very positive for Korean IT sector. One thing is with Fed rate cut, dollar should fall a bit more. Emerging market interest should rise quite quickly. Expect US market to rise by 20% over next 1 year, while emerging market should rise by 1.5~2 times of that over the next 12 months, but Korea would rise by half of that of US.
The IMF has released a report saying growth in the Asia-Pacific region is slowing down more than expected. Generally what's the outlook for Asia among global institutions, and how does Korea figure into this?
IMF lowered Asia growth rate for this year from 5.4% to 5.0%, and for next year by 0.3% point. And for Korea it owred by 0.6% point. Issue of Korea Japan dispute was raised as well.
China risk, Hong Kong Protest, Uncertainty in middle east, High consumer debt, corporate debt and weather change and natural problem were mentioned as risk.
IMF is asking further rate cut and money supply. Also, budget increase is needed.
Do we really need to be ready for Asian economic recession? I doubt that will happen.
Alright, Mr. Yoo. That's where we'll have to leave it today.
As always, we appreciate your insights.
