U.S. Credit Rating Downgrade, Market Remains 'Calm'

🔍 1. U.S. Credit Rating Downgrade and Market Reaction

Moody's downgraded the U.S. credit rating, causing a slight market downturn.
In the past, when S&P and Fitch downgraded the U.S. credit rating, the stock market showed weakness for 1 to 2 months.
This time, U.S. futures also declined, reflecting cautious sentiment in the market.
However, the drop was not as severe as in previous cases.

• S&P Downgrade: -3.8% on the first day
• Fitch Downgrade: -1.9% on the first day

Tonight's U.S. market movement is expected to be crucial in determining the impact.

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💡 2. Expert Reactions

• Besent: "Credit rating downgrades are just lagging indicators."
  • He emphasized that Saudi Arabia's large-scale investment actually proves U.S. creditworthiness.
• Domestic Securities Firms: While the downgrade poses a burden, its impact is expected to be limited.

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💰 3. Rising Interest Rates and Tax Cut Bill Passage

U.S. Treasury yields continued to rise.
Trump's tax cut bill passed the House Budget Committee, raising concerns about the increasing U.S. government debt.
This further solidifies Moody's reasoning for the downgrade.

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🌐 4. Trade War: Will Corporate Pressure Continue?

Besent warned of high tariffs for countries showing insincerity in trade negotiations.
He pointed out that some countries are using a "wait-and-see" strategy.
Trump sent a message to Walmart, saying, "Do not raise prices; absorb the cost."
This statement raises concerns about potential pressures on corporate earnings.

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🇨🇳 5. Chinese Economic Indicators Released, Signs of Slowdown

China released its industrial production and retail sales figures.
The numbers themselves were not bad, but the growth rate showed signs of slowing.
The ongoing tariffs are pressuring the Chinese economy, which may become a driving force in trade negotiations.

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📉 6. Supply and Demand Trends

Foreign investors, who had been buying since May, switched to selling due to the credit rating issue.
Rather than an increase in selling, there was a noticeable drop in buying.

• Sectors with Selling Pressure: Machinery, Transportation Equipment
• Sectors with Buying Interest: Financials

The KOSDAQ saw net selling for three consecutive days.

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🚀 7. Key Stock Movements

• EV Batteries: Strengthened as the IRA amendment was rejected, easing concerns over subsidy elimination.
• Robotics Stocks: Significant decline.
• Semiconductors: Weakness continued due to brokerage analysis suggesting a challenging market recovery.

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🔮 8. Stock Market Outlook

Tonight's U.S. market performance is expected to be a key indicator.
However, this credit rating downgrade is unlikely to be a 'game changer.'
A short-term rebound is possible, but overlapping tariff issues could cause temporary volatility.

• The market has not yet entered an oversold territory.
• In the latter half of this week, price pressures are expected to ease.
• Now may be a good time to pay attention to stocks with solid earnings but suppressed prices.

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✅ Summary at a Glance

1️⃣ Moody's Credit Downgrade → Limited market impact
2️⃣ Trump's Tax Cut Bill Passed → U.S. Treasury yields rise
3️⃣ Trade War Continues → Potential pressure on corporate earnings
4️⃣ Chinese Economic Slowdown → May act as a driving force in negotiations
5️⃣ Decrease in Foreign Buying → KOSDAQ net selling for three days
6️⃣ EV Batteries Up, Semiconductors Down