[R&E] Domestic Stock Market Closes Mixed; DKT's High Earnings Growth and SK Telecom's AI Momentum Draw Attention

[R&E: Research & Epoch] This is News Epoch's signature report that forecasts a new era of investment by comprehensively analyzing global financial data and research from domestic securities firms.

Global Market Brief

On the previous trading day (Tue, 06/02), the New York stock market saw all major indices rise, breaking new highs. The Dow Jones closed up 0.45%, the NASDAQ up 0.03%, and the S&P 500 up 0.13%. In particular, the Philadelphia Semiconductor Index surged 5.87%, with tech stocks and artificial intelligence (AI)-related momentum leading the market's strength. This was the result of Nvidia (NASDAQ: NVDA) announcing the mass production of its new platform 'Vera Rubin' and the arrival of the AI agent economy, raising expectations for technological innovation.

However, the robust trend in the US labor market acted as a factor weakening expectations for an interest rate cut by the Federal Reserve (Fed). According to the April Job Openings and Labor Turnover Survey (JOLTS) report, total job openings increased by 731,000 from the previous month to 7.618 million, marking the highest level in two years. The ratio of job openings to unemployed persons increased from 0.95 to 1.03. This suggests that the still-solid labor demand could lead to persistent inflationary pressure. Meanwhile, the Eurozone inflation rate in May recorded 3.2% year-on-year, and energy costs rose by 10.9%, posing a burden on the European Central Bank's (ECB) monetary policy operations.

Domestic Market Overview

On the previous trading day (Tue, 06/02), the domestic stock market closed mixed. The KOSPI index recorded a slight increase of 0.15% to 8,801.49 points, but showed high volatility, exceeding 8,900 points during intraday trading. On the other hand, the KOSDAQ index fell 2.29% to 1,026.03 points, continuing its weakness for five consecutive trading days. This marks the lowest close since the 978.4 points recorded during the burden of the Iran war on March 4. Amid uncertainty, market participants showed a tendency to focus on large-cap stocks or companies with specific growth momentum rather than small and mid-cap stocks.

As an external variable, the dollar-won exchange rate rose by 4.0 won from the previous day to 1,516.9 won, continuing the weakness of the won. This stimulates import prices, acting as an upward pressure on domestic inflation. Indeed, South Korea's May Consumer Price Index (CPI) rose 3.1% year-on-year, and petroleum prices jumped by a staggering 24.2%. The inflationary pressure leads to the possibility of a base interest rate hike by the Bank of Korea. There are forecasts that the base rate will be raised twice within this year (July and October) and once more in early 2027. Conversely, the domestic bond market showed strength. The yield on 3-year government bonds closed at 3.774%, down 1.6 bp, and the 10-year yield closed at 4.127%, down 5.2 bp. Net buying of Korea Treasury Bond (KTB) futures by foreign investors acted as the main driver for the downward shift in yields.

Key Industry Issues and Insights

Expansion of AI and Advanced Components Sectors

The acceleration of the artificial intelligence (AI) revolution is expanding beyond semiconductor manufacturers to IT infrastructure, advanced components, and telecommunications companies. Nvidia announced the mass production of its next-generation AI platform, 'Vera Rubin', declaring the arrival of the AI agent economy. Along with this, it will expand its supply chain twofold and maximize efficiency by reducing rack assembly time from 2 hours to 5 minutes. In particular, the Nvidia Vera Rubin platform will require 2 to 3 times more circuit boards compared to the existing 'Blackwell' and see higher unit prices due to larger substrates, an increased number of layers, and the addition of midplane substrates for cableless designs. This leads to benefits for key partners like CFL, which supplies high-end circuit boards to Nvidia. CFL benefited from the AI-driven increase in demand, with its Q1 revenue rising 53% and net profit soaring 218% year-on-year.

The domestic advanced component company DKT (KOSDAQ: 290550) recorded Q1 revenue of 115.6 billion won, growing 33.8% year-on-year. Operating profit was 8.8 billion won, up 259.8% from the same period last year, exceeding the market estimate of 3.2 billion won by about 2.7 times. This demonstrates that business diversification has been successfully achieved, such as securing an order backlog of about 330 billion won for automotive OLEDs from domestic and foreign original equipment manufacturers (OEMs), and an estimated significant increase in Energy Storage System (ESS) Battery Management System (BMS) revenue to 51.8 billion won in 2026. In addition, it started the initial delivery of 2,000 charging modules for a North American robotics company in April and announced a 22 billion won investment in new facilities in Georgia, North America, securing future growth momentum.

Global IT infrastructure company H.P. Enterprise Co. (NYSE: HPE) also recorded FY2Q26 revenue of $10.7 billion, a 40% increase year-on-year, exceeding the market consensus by 9.2%. In particular, operating profit was $1.4 billion, up 132.1% year-on-year, beating the consensus by a whopping 40.5%. This indicates that the increase in demand for AI infrastructure drove the earnings improvement, with the total AI-related order backlog reaching $6.3 billion. Domestic telecommunications company SK Telecom (KOSPI: 017670) also saw its stock price rise by 11.6% after being introduced as a major cooperative partner of Nvidia the previous day. This shows that AI technology is serving as an opportunity to re-evaluate the value of traditional industries.

Materialization of the Robotics Industry and the Rise of the Chinese Market

Along with the development of AI technology, the growth potential of the robotics industry is gradually materializing. Nvidia revealed its commitment to the convergence of AI and robots by pursuing direct investments in two domestic robot startups. In particular, the listing of a humanoid robot company is imminent in the Chinese market. Unitree has received a registration approval certificate from the China Securities Regulatory Commission (CSRC) and is expected to be listed on the STAR Market in about 3 to 4 weeks. This is highly significant in that it will become the first humanoid robot company to be listed on the Chinese A-share market. UbTech is already listed on the Hong Kong stock market, increasing investment interest in the Chinese robot industry.

Interest in robot-related stocks was also hot in the domestic stock market. On the previous trading day, Company K Partners (KOSDAQ: 307930) and Robostar (KOSDAQ: 090360) hit the upper limit, and Doosan Robotics (KOSPI: 454910) rose by 20.5%. This is interpreted as the result of the expanded application of AI technology to robots and the news of humanoid robot listings in the Chinese market raising expectations for domestic related stocks.

Dynamics of the Global Electric Vehicle Market

In the global electric vehicle market, the fortunes of major players are diverging amid intensifying competition and policy changes. Tesla (NASDAQ: TSLA) widened its rebound in sales in major countries in May. Including unannounced countries such as the UK and Germany, the sales volume in May is expected to be over 25,000 units, an increase of more than 80% compared to the same month last year. Strong electric vehicle sales across Europe had a positive impact on Tesla's rebound.

On the other hand, the Chinese New Energy Vehicle (NEV) market showed a mixed trend. BYD (SZSE: 002594) sold 383,453 new energy vehicles in May, up 19% from the previous month and 0.3% year-on-year, and showed global expansion with export volumes reaching 160,644 units, an 80% increase year-on-year. Leapmotor, Nio, and Zeekr also showed strength with May sales volumes increasing by 62~82% year-on-year. However, Li Auto's May sales volume was 33,350 units, an 18% decrease year-on-year, and Xpeng also saw a 4% decrease year-on-year. This suggests the fierce competition within the Chinese electric vehicle market and the importance of differentiated strategies by brand.

Market Signals

• Strength in Finance and Retail Stocks: On the previous trading day, Shinsegae (KOSPI: 004170) rose 10.3%, Hyundai Department Store (KOSPI: 069960) rose 8.7%, Samsung Life Insurance (KOSPI: 032830) surged 17.1%, and Mirae Asset Life Insurance (KOSPI: 085620) went up 14.3%, indicating expectations for domestic demand recovery and a strong trend in value stocks.

• US Housing Market: Berkshire Hathaway (NYSE: BRK.A) acquired homebuilder Taylor Morrison Home (NYSE: TMHC) for approximately $8.5 billion, reflecting a 24% premium at $72.50 per share. This shows the perception of value in the housing market by large investors despite high mortgage rates.

• Rebound in Certain Biotech Stocks: Kolon TissueGene (KOSDAQ: 950160) rose 9.7%, and Oscotec (KOSDAQ: 039200) rose 6.2%. In particular, Oscotec was positively impacted by the news that it had exported autoimmune technology to the US company Agios.

• Strong Earnings of Global Companies: Victoria's Secret (NYSE: VSCO) saw its stock price surge 47% following an earnings report that exceeded expectations and an upward revision in sales forecasts, while Marvell Technology (NASDAQ: MRVL) also recorded strong short-term buying pressure, with its stock jumping 32% backed by solid earnings and an upward guidance revision.

Epoch View: Investment Implications

On the previous trading day, the domestic stock market showed clear differentiation between the KOSPI and KOSDAQ, focusing on the growth momentum of individual companies and sectors rather than the overall direction of the market. The robustness of the US labor market and Eurozone inflation lead to the maintenance of a tightening stance in global monetary policy, putting a burden on investment sentiment.

However, the growth of new industries led by AI technology is driving comprehensive changes in the industrial ecosystem, including advanced components, IT infrastructure, and robotics, creating new investment opportunities. In particular, the high earnings growth of domestic advanced component companies like DKT and SK Telecom's AI partnership serve as evidence that companies successfully responding to these changes can be re-evaluated in the market. In a complex macroeconomic environment, a company's strategic diversification and innovation capabilities are expected to become key variables determining market performance.

This content was generated through News Epoch's proprietary AI algorithm, which tracks and analyzes public data from major domestic securities firm research centers and global financial media in real-time. It is an objective summary based on collected data, and it is clarified that this is not an investment solicitation or recommendation for specific stocks.