TradingKey - Hotter-Than-Expected US PPI Triggers Rate-Hike Fears! KOSPI and Nikkei 225 Plunge Around 2%, Kioxia Plummets Nearly 7%, Samsung Electronics and SK Hynix Follow Suit Lower

During the Asian trading session on September 11, stock markets in both Japan and South Korea opened significantly lower and suffered sharp declines. Among them, the KOSPI Index closed down 1.76% at 6,909.92 points. Both heavyweights took a severe hit, with Samsung Electronics dropping 3.53% to close at 259,500 KRW, while SK Hynix fell 2.21% to 1,812,000 KRW.

KOSPI Index chart, Source: TradingView

The Nikkei 225 Index suffered an even larger decline, ultimately closing down 1.93% at 64,011.29 points. Two major heavyweights tumbled, with Kioxia falling 6.99% to close at 54,030 JPY, and SoftBank dropping 3.96% to 6,540 JPY.

The US August PPI YoY growth rate rebounded to 5.4%, higher than the expected 5.3%, indicating that inflation remains highly sticky. Market bets on the Federal Reserve (Fed) continuing to raise interest rates or keeping rates elevated surged, with the CME rate-hike probability spiking to over 70%. In addition, 10-year and 30-year US Treasury yields surged, directly suppressing valuation space for risk assets such as Asia-Pacific equities.

Looking ahead, market focus will shift to the US Consumer Price Index (CPI) to be released today. If inflation growth slows and rate-hike fears ease, Japanese and South Korean stock markets may experience a structural rebound next Monday. Conversely, if inflation persists and CPI data reinforces expectations that the Fed will maintain high interest rates or even hike rates next week, stock markets in Japan and South Korea will face another round of sharp sell-offs.

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