Stock — SH Consulting

Stock

A daily market brief, published each morning. Markets, stocks, industry, economy, global, and policy — sorted by category.

Policy·2026-09-18

BOJ Raises Rate to 31-Year High of 1.25%, Bank of England Halts Quantitative Tightening

The Bank of Japan raised its policy rate from 1% to 1.25%, a 25bp hike, today. The vote passed 7-2, with members Asada and Sato dissenting. The BOJ stated it would continue raising rates further if the economy, prices, and financial conditions evolve as projected, while adding that the timing and pace would be decided while monitoring risks. Japan's core CPI released today came in at about 1.9% year-on-year, with the need to keep underlying inflation from exceeding 2% cited as the background for the hike. Analysis suggested that the fundamental reason behind Japan's rate hike is to defend against yen weakness. Because of the large interest rate gap between Japan and the US, funds have continued flowing from low-rate Japan into high-rate US assets, deepening yen weakness. However, since the US also raised rates just before Japan's decision, the rate gap either stayed the same or the dollar strengthened further, leading to an assessment that this BOJ hike alone will have limited effect in curbing yen weakness. It was noted that the BOJ's pace of rate decisions is typically slow, roughly once every six months, making this hike, which came just three months after the last one, an unusually rapid adjustment. The market reportedly views this pace as still insufficient and believes consecutive further hikes are needed, with attention on whether Governor Ueda's press conference at 3:30 PM will send a clear signal on the pace of future hikes. Concerns were also raised that if no such signal emerges, yen weakness will not be curbed, but if it does emerge, it could reignite the issue of unwinding yen carry trades, as funds that had flowed out of Japan into the US and elsewhere reverse course. Immediately following the decision, the dollar-yen rate quickly settled around 156 yen, having briefly dropped to 154-155 yen (yen strength) intraday before reversing higher again. It was noted that, given the yen's large weight in the dollar index, this could affect future trends, and remarks expected from Prime Minister Takaichi's 6:30 PM press conference regarding expansionary fiscal policy were also cited as a variable for weekend bond market moves. The Bank of England held its policy rate hawkishly the previous day while also announcing a halt to gilt sales (quantitative tightening). This signals an end to the policy of absorbing liquidity by selling gilts into the market, which is seen as maintaining market liquidity and easing the burden of gilt supply, resulting in lower UK gilt yields. It was assessed that the UK, whose fiscal position is relatively unstable, aligning with efforts to stabilize its gilt market also contributed to broader stability in European and US Treasury yields.

Policy·2026-09-16

US-Korea Investment MOU Delayed Amid Disagreements Over Westinghouse Stake, Nuclear Power Talks

Ahead of the Korea-US foreign ministers' meeting scheduled for the 18th, an exclusive report that a National Assembly briefing on the US-bound investment had been canceled the previous day fueled speculation that the Korea-US memorandum of understanding (MOU), originally expected to be signed this week, could be delayed. The broad framework agreed last year called for a total of $200 billion in US-bound investment, an annual cap of $20 billion, a 45-day review period for each project, and a so-called umbrella structure in which profits and losses across multiple projects would be consolidated and handled by a single top-level entity. However, disagreements have reportedly widened as the US side has recently raised a series of additional requests — including gas-fired power plants for data centers, the construction of eight new nuclear reactors, and participation in the Alaska LNG project — pushing the total beyond the cap and prompting the US to demand project-by-project individual settlement. One of the key points of contention is the Westinghouse equity stake. The Korean side is reportedly seeking a stake and voting rights of around 15% to 20% in order to secure substantive decision-making authority over nuclear power exports, while the US side is offering a financial investment level of around 5%, leaving the two sides without common ground. With last year's agreement effectively constraining independent exports of Korean-model nuclear reactors, securing a Westinghouse stake is being discussed as a practical means of removing that constraint. The two sides are also said to hold differing views on the commercial viability of the Alaska LNG project. Analysts pointed to President Trump's political calculus ahead of the midterm elections — seeking to highlight a large-scale investment achievement — as the driving force behind the US push to conclude the MOU quickly. From Korea's perspective, by contrast, there is little urgency to rush, and the view offered was that Korea should make full use of the 45-day review period to calmly work through key issues such as the equity stake and profit settlement structure. Overnight, a cloture vote in the US Senate on the CLARITY Act related to stablecoins failed to clear the 60-vote threshold, garnering only 50 votes in favor. Passage of the CLARITY Act had been expected to expand stablecoin issuance and, through that, boost demand for US Treasuries, lending support to Treasury Secretary Bessent's strategy of balancing short- and long-term issuance. The bill's failure was accordingly cited as a factor that could further dampen Treasury demand and add to upward pressure on long-term rates.

Policy·2026-09-14

Korea Exchange Launches New After-Market, Extending Trading to 8 PM

Starting today, the Korea Exchange has launched a new after-market session running from 4 PM to 8 PM, allowing real-time trading of most listed stocks (excluding ETFs). While the existing alternative trading system (NXT)'s after-market covered only about 600 tradable names, this new session adds more than 1,500 additional tradable stocks. Orders placed during the regular session are not automatically carried over and must be re-entered separately, and only limit orders are allowed — market orders are not — which may make volatility relatively more limited than in the regular session. While alternative trading venues have long operated both a pre-market (morning) and after-market (afternoon) session, the Korea Exchange had focused solely on the regular session. As the alternative trading market has grown, the Korea Exchange appears to have entered the after-market to avoid losing out on fee revenue and other gains. The net effect is similar to extending the regular session through 8 PM. Questions were raised about the purpose of this change. While longer trading hours could allow investors more time to avoid rushed decisions during volatile periods, critics noted the change was introduced without a clear stated goal of investor benefit or volatility reduction. Some analysis suggested the aim was to capture domestic trading demand tied to evening-hour US futures movements, particularly around AI-related stocks, but this too was seen as ultimately serving the exchange's revenue expansion interests. Concerns were raised about layering a new institutional change onto an already unstable market, along with advice to monitor how the change in trading hours may disrupt existing pre-market/after-market linked trading patterns.