U.S. July PCE Meets Expectations…Inflation Relief Limited

The Dow Jones Industrial Average fell by 0.21%, the Nasdaq Composite by 0.08%, and the S&P 500 by 0.02%. However, the Philadelphia Semiconductor Index rose by 0.2%, showing some anticipation reflected in certain stocks.

The U.S. July PCE price index showed the headline figure exceeding market expectations, recording 0.2% month-over-month (expected 0.1%) and 3.7% year-over-year (expected 3.6%). However, the core PCE, excluding food and energy, met expectations, leading to a mix of concerns about the pace of inflation decline and a sense of relief in the market. Consequently, the overall interpretation of inflationary pressures was divided.

However, expectations for a rate freeze at the September FOMC still remain at over 60%, creating an atmosphere of relief in the market for now.

Particularly, data center segment sales reached approximately 123 trillion won, showing overwhelming growth with a 117% increase year-over-year.

This positive outlook provides a strong basis for the continued expectation of Nvidia's strong performance.

This segment is notably expanding its customer base beyond hyperscalers to include general enterprises and government agencies. This demonstrates that artificial intelligence (AI) investment is not concentrated solely among a few big tech companies but is widespread.

This served as a positive signal, alleviating market concerns about potential product gaps after the Blackwell and Ultra architectures. Furthermore, with an anticipated product cycle in 2027 and expected power efficiency advantages of next-generation chips, Nvidia's long-term growth momentum appears secured.

Nvidia stated that it recorded 279 billion dollars for memory supply and CAPA commitments. This suggests that even if Samsung Electronics and SK Hynix stock prices fluctuate due to shareholder return policies or short-term supply and demand issues, there are no fundamental problems with the memory market conditions themselves. This raises expectations for the intensity and sustainability of the artificial intelligence (AI) memory cycle.

However, there's a high possibility of profit-taking sales if it reaches a technical resistance zone. Therefore, from a buying perspective, a strategy of waiting for a dip rather than chasing a rapid rise is effective.

Caution is needed if the stock price reaches this level, as it may fall back down. The initial support line is around 254,000 won, with a secondary support line at 242,000 won. Investors can refer to these price levels when considering a dip buying strategy.

Samsung Electronics is rapidly expanding its market share in high bandwidth memory (HBM) and narrowing the gap with SK Hynix. It is also showing rapid growth in the foundry market, strengthening its competitiveness in the semiconductor sector. Alongside this, strong foldable phone market share also underpins Samsung Electronics' overall growth momentum.

If SK Hynix's stock price breaks this level at market open and maintains it for three consecutive trading days, it can be interpreted as entering a full-fledged growth trajectory. A strategy to lower the average purchase price can also be considered based on the current stock trend.

Companies in the power infrastructure value chain, such as transformers, transmission networks, energy storage systems (ESS), and uninterruptible power supplies (UPS), are emerging as promising sectors. Hyosung Heavy Industries, LS ELECTRIC, and HD Hyundai Electric, among others, are attracting attention, and power infrastructure has significant long-term growth potential as it is difficult to build in the short term.

Despite Nvidia's strong earnings report, the Bank of Korea's Monetary Policy Board's interest rate decision could be a significant variable for the domestic market. If the Monetary Policy Board issues hawkish interest rate hike statements, Nvidia's positive news could be diluted. Therefore, it is advisable to refrain from chasing purchases until the interest rate decision is announced and to respond to the market after confirming the Monetary Policy Board's results.