Brent Crude Tops $100 and Quadruple Witching Day Delay KOSPI's Push to 7,000

[Global] Iran-U.S. Military Clash Intensifies, Oil Breaks Above $100 Amid continued reports of tanker sinkings and explosions in the southern Strait of Hormuz, U.S. Central Command confirmed it had sunk five Iranian oil-carrying vessels, and Iran also fired ballistic missiles targeting naval vessels, though the U.S. military claimed it successfully evaded them. Amid this escalating tension, Brent crude broke above $100 per barrel, and WTI also rose to around $96 during Asian trading hours. President Trump had repeatedly suggested that the war would end soon, but this time, for the first time, he made remarks pushing back the timeline, suggesting an end to the war would only come after the midterm elections. This contradicts prior expert forecasts that he would rush to end the war before the midterms to ease inflation pressure, prompting various interpretations — that it may be a political strategy to eliminate election-season material altogether, an attempt to neutralize the negotiating leverage Iran holds, or a smokescreen aimed at maximizing the impact of a behind-the-scenes settlement. HSBC analyzed that disruptions to the Strait of Hormuz could become the new normal, and that alternative shipping routes alone would not be enough to fully offset the reduced volume, forecasting that Brent crude could rise to $120 per barrel if disruptions to Russian refining facilities are added to the mix. However, some assessed that since the market has already priced in some possibility of a prolonged war, there was no sharp drop following Trump's remarks. Is Bessent's 'House' Remark a Bluff? Treasury Secretary Bessent recently made provocative remarks to the effect of "I am the house, the game is mine," challenging market participants to bet against him, and also suggested he holds an informational edge that can be used to guide market judgment. This has been interpreted as an expression of confidence that he holds influence even over U.S. Treasury yields and the yen market. However, analysis suggests such remarks are closer to bravado made in a situation where there are actually no adequate countermeasures available. The increasing frequency of attempts to calm the market through words rather than proving intent through actual cash measures such as bond purchases raises concern that this could be a sign of underlying weakness. Underlying this trend is the diagnosis that if inflation and interest rates remain uncontained despite rising oil prices, there will ultimately be no solution other than ending the war. The view was also presented that U.S. leadership is weakening as its stance shifts from claiming the moral high ground to a scramble over interests. Treasury Buybacks and the Clarity Act: A Tug-of-War Over Rates The Treasury Department announced an expansion of its long-term bond buyback size from a minimum of $4 billion to $6 billion, but the market was disappointed as it had expected a level of $8 billion to $10 billion, causing Treasury yields to rise across the board from 2-year to 30-year maturities. During Asian trading hours, the 2-year yield stood at 4.432%, the 10-year at 4.843%, and the 20-year broke above 5.3%. However, the overnight 10-year auction showed a solid bid-to-cover ratio of 2.7-to-1, indicating that underlying demand remained firm, with some also viewing current levels as an attractive absolute-yield zone. Secretary Bessent has repeatedly urged passage of the stablecoin-related Clarity Act, which is tied to a virtuous-cycle concept: encouraging stablecoin issuers to purchase short-term Treasuries as pegged assets, thereby boosting short-term Treasury demand and, on that basis, securing capacity for long-term Treasury purchases. However, unresolved issues remain, including the scope of bank participation and conflict-of-interest concerns for public officials, raising the likelihood that even the cloture vote on the bill — originally slated for mid-September — could be delayed. Ultimately, rising oil prices are feeding through to inflation and rate pressures, and the Treasury's buyback and stablecoin policy efforts to ease this have repeatedly failed to produce clear results, reinforcing the diagnosis that the only fundamental solution is an end to the war. Sovereign Bond Yields by Maturity (Asian Trading Hours) — Comparing yields on 2-year, 10-year, and 20-year government bonds, yields rise with longer maturities, with the 20-year surpassing 5.3%. Futures and Options Quadruple Witching Day: A Tug-of-War Over Retail Selling Below 7,000 This was so-called quadruple witching day, when the four types of stock index and single-stock futures and options expirations coincide, a day when volatility can widen due to program trading tied to rollovers and contract settlements. The KOSPI fluctuated around 6,970 to 7,000 points, down 0.7% to 0.9%, while the KOSDAQ held modestly higher, and foreign investors were net sellers in both cash and futures markets. From September 3 to 9, retail investors net sold approximately KRW 19.62 trillion, which was interpreted as stop-loss-driven selling of positions bought in the 7,500 to 8,500 point range now returning near breakeven. Cumulative buying in that range is estimated at around KRW 100 trillion, and the diagnosis is that once this overhang is absorbed, the range-bound market could end, giving way to a foreign- and institution-led uptrend following the completion of the ownership handoff. The exchange rate was identified as the key variable driving foreign buying. With no major issues in fundamentals such as semiconductors, the exchange rate is the last checkpoint foreign investors examine, and its recent stabilization is seen as sustaining the trend of foreign net buying. KRX Semiconductor Index Rebalancing Adjusts Samsung Electronics and SK Hynix Weights KRX sector indices have a rule capping individual stock weights at 20%, and with SK Hynix's weight rising to 36.7% and Samsung Electronics' to 22.8%, a mechanical weight adjustment took place on this day coinciding with the futures and options expiration. The combined net asset value of the three ETFs tracking the KRX Semiconductor Index stands at approximately KRW 7.6 trillion, a sevenfold increase from a year ago. Estimates suggest SK Hynix's weight will fall by about 16 percentage points and Samsung Electronics' by about 3 percentage points, with an expected sell-off of roughly KRW 1.4 trillion in value, but both stocks are seen as easily absorbable within a day or two, with limited risk of a sharp decline. Conversely, stocks gaining weight such as Hanmi Semiconductor (about KRW 300 billion) and Jusung Engineering (about KRW 180 billion) saw inflows, and both stocks rose strongly on this day. This was explained as volatility driven purely by supply-and-demand factors rather than fundamentals, and should be interpreted as a reallocation of funds within the overall semiconductor sector. Individual Stock Weightings in the KRX Semiconductor Index — Comparing the weightings of SK Hynix and Samsung Electronics in the KRX Semiconductor Index, SK Hynix outweighs Samsung Electronics. Robotis and Yujin Robotics Rally, SK Hynix ADR Provides Tailwind Robotis rallied on news that it will hold a joint workshop with Nvidia at the Seoul Humanoid Summit. Expectations grew around the session, in which Robotis will present hardware joint and manipulation technology while Nvidia presents software-stack-based humanoid technology, with Nvidia's head of robotics set to attend in person. Yujin Robotics rose in tandem on news that it will jointly develop all-solid-state batteries for humanoids with SK On. Robotics-related stocks broadly advanced as well, including CS Robotics, Samhyun, and Now Robotics. With robotics-related companies recently turning profitable and continuing to report new orders, the view was also raised that the humanoid industry, once seen as a distant future theme, is entering a phase of tangible revenue generation. SK Hynix's favorable U.S. ADR price movement also had a positive effect on investor sentiment toward the domestic semiconductor sector. Apple Unveils Foldable iPhone Duo, but Tepid Response Amid Price Concerns At its new product event in the early hours of September 10, Apple unveiled its first foldable phone, the iPhone Duo, along with the iPhone 18 Pro and 18 Pro Max, AirPods, and Apple Watch 12 and Ultra 4. The Duo starts at $2,000 in the U.S. and is expected to launch domestically at around KRW 3.29 million for the 256GB model, roughly 65% higher than the starting price of the iPhone 18 Pro, which uses the same A20-series chip. Compared with Samsung's Galaxy Z Fold8 (KRW 2.27 million), the domestic price gap reaches about KRW 1 million, drawing complaints from domestic consumers. The device was introduced as featuring Apple Intelligence-based Siri AI capable of personal context understanding and conversational responses, but it launches with English-language priority, and the specific AI feature descriptions were assessed as remaining an extension of previous announcements. Accordingly, Apple shares closed down about 0.2% overnight, reflecting a tepid market response. Doubts were also raised about the distinctiveness of on-device AI itself. With smartphones already offering voice access to various generative AI applications, unless Siri evolves into a genuinely capable personal assistant, hardware premiums alone will struggle to drive consumer response. However, the expansion of component demand following the new product launch was cited as a positive factor for the semiconductor sector. Domestic Launch Price Comparison for Foldable Phones — Comparing the domestic launch prices of the iPhone Duo and Galaxy Z Fold8, the iPhone Duo is more expensive.