Declining bond yields and semiconductor strength prove positive, yet rising oil and a stronger dollar drive intraday volatility
Indices pause ahead of holidays as selective stock rallies continue across telecom equipment, oil refining, and robotics
Key Market Trends
① 10-year US Treasury yield drops to 5.23%, fueling peak-rate speculation
The yield on the benchmark 10-year US Treasury note retreated to 5.23% after breaching 5.3% during intraday trading.
Federal Reserve Governor Philip Jefferson’s remarks urging caution regarding further policy tightening added weight to expectations—already bolstered by New York Fed President John Williams—that the central bank will hold rates steady in October.
Yields were also pressured downward by the US Treasury's execution of a $6 billion debt buyback and safe-haven capital flows into German and US sovereign bonds amid fiscal jitters in France.
With the rise in third-quarter US Treasury yields marking their largest quarterly surge since 1994, analysts suggest the recent upward trajectory may have been overextended.
② Micron's solid earnings reassessed, easing memory cycle peak concerns
On Wall Street, Micron Technology shares rebounded after overcoming initial after-hours weakness following its earnings release, offering a positive spillover effect to domestic semiconductor sentiment.
Expanding long-term client relationships—with supply negotiations extending into 2028—helped alleviate concerns over a cyclical peak in the memory market.
Furthermore, concerns surrounding gross profit margins were clarified as the result of increased employee incentives rather than operational underperformance.
Expectations that supply shortages could persist even after capacity expansions have sustained upbeat assessments of the semiconductor industry outlook.
③ Rising oil and a stronger dollar weigh on sentiment; markets pause ahead of holidays
International oil prices advanced following reports of the US deploying a third aircraft carrier to the Middle East and reinforcing regional troop levels.
A stronger US dollar also capped gains across the domestic stock market.
Refining stocks rallied on news of China’s suspension of petroleum product exports, while gains were also observed in telecom equipment, robotics, and shipping sectors.
Meanwhile, semiconductor materials, parts, and equipment (SPE) stocks, which showed strength the previous day, exhibited mixed performances.
Supply, Demand, and Sectors
Foreign investors net-sold electrical/electronic equipment, finance, and pharmaceuticals, while net-buying chemicals, retail, transportation/storage, and telecommunications.
On the KOSDAQ market, foreign investors net-bought financial and electrical/electronic issues.
Institutional investors net-bought finance, metals, and chemicals, while net-selling electrical/electronic equipment, transportation equipment, construction, and IT services.
On the KOSDAQ, institutions net-bought electrical/electronic equipment and metals.
Market Perspective
In today’s session, oil prices rose, bond yields fell, and the US dollar strengthened. While lower interest rates are inherently positive, it is crucial to examine the underlying drivers behind the decline.
If the depreciation of the euro—triggered by French fiscal concerns—prompted capital flows into US Treasuries and the greenback, the drop in yields may partly reflect a flight to safety. This underscores the need to analyze why falling yields and a stronger dollar occurred concurrently.
That said, geopolitical risks in the Middle East, European fiscal anxieties, and oil price movements are already largely priced into the market. Rather than dictating a new directional trend, these factors are currently acting as catalysts for heightened volatility.
The KOSDAQ index recorded three consecutive weeks of gains for the first time since April, with the thematic, stock-picker's market persisting since September. It is an opportune time to monitor whether sector rotation continues across established market leaders—including telecom equipment and semiconductor SPEs—as well as policy- and investment-driven industries.
Source: Market Watch Stock Stories (t.me/shmstory)
YouTube: Market Watch TV (www.youtube.com/@blueoak1004)
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