[Dongchun Weekly] April Week 3 — Hormuz Opened, Nasdaq Logged 13 Straight, Then the Weekend Talks Collapsed

Hey, Dongchun here.

Here is how the week went.

1. The Week in Numbers

This week was as close to a perfect risk-on environment as markets get. Nasdaq posted 13 consecutive gains — its longest winning streak since 1992 — while the S&P 500 crossed 7,100 for the first time in history and closed at 7,117. The single biggest driver was Iran declaring the Strait of Hormuz open to all commercial vessels on Thursday April 17, sending WTI crude crashing -14.5% for the week and triggering simultaneous new all-time highs across every major US index. The breadth was genuinely healthy: Russell 2000 small-caps rallied +4.0% to a new all-time high, which confirms this was market-wide participation rather than a mega-cap concentration trade. Korea outperformed the US by a wide margin — KOSPI +6.6% vs S&P +3.4% — reflecting cheap valuation after March's heavy foreign selloff combined with a surge in foreign buying concentrated on Samsung Electronics and SK Hynix. The dollar weakness (DXY -1.3% to a 7-week low) and the oil price crash created an ideal macro backdrop for equities, especially emerging market names like Korea.

Index	Week Open	Week Close	Weekly %	Note
S&P 500	6,886	7,117	+3.4%	First-ever close above 7,100
Nasdaq	23,184	24,469	+5.5%	13-day win streak — best since 1992
Dow Jones	48,218	49,447	+2.5%	Fully erased all Iran-war losses
Russell 2000	2,670	2,776.90	+4.0%	All-time high — healthy breadth signal
KOSPI	5,808	6,191.92	+6.6%	Crossed 6,200 intraweek
KOSDAQ	1,100	1,170.04	+6.4%	4-month high territory

KOSDAQ is Korea's tech-heavy small/mid-cap exchange — think of it as the Korean Nasdaq for domestic growth companies.

Indicator	Start of Week	End of Week	Weekly Change	What It Means
US 10Y Yield	4.31%	4.29%	-2bp	Stable — no rate pressure on growth stocks
DXY (Dollar Index)	99.0	97.70	-1.3%	7-week low — EM tailwind, KRW strengthens
VIX (weekly high)	18.76	18.22	Stable	Fully recovered from March spike to 31
EWY (Korea ETF)	~$78	~$82	+5.1%	Foreign return to Korean equities confirmed
WTI Crude	$97.98	$83.78	-14.5%	Hormuz opening crushes oil inflation fear

2. 3 Big Themes of the Week

Theme 1 — Iran Opens the Hormuz Strait (April 17)

On Thursday April 17, Iran declared the Strait of Hormuz open to all commercial vessels during the Lebanon ceasefire period, and President Trump said the war with Iran was almost over. The Hormuz Strait is a narrow waterway between Iran and Oman through which roughly 20% of global oil supply passes — when Iran threatened to close it in February, oil prices spiked and inflation fears returned. The reversal on Thursday was immediate and violent: WTI crude crashed -11.5% in a single session, the largest one-day oil drop in years, and every major US index simultaneously hit a new all-time high. For Korean investors, lower oil prices are a structural positive because Korea imports nearly all its energy — cheaper oil directly reduces input costs across Korean manufacturing and boosts domestic consumer spending power. The Korea angle is not just macro: the geopolitical de-escalation drove a relief rally in Korean stocks broadly, with KOSPI gaining +6.6% on the week as foreign investors resumed buying at a pace not seen since January.

Theme 2 — Nasdaq's 13-Day Win Streak: The Wall of Worry Trade

The Nasdaq logged 13 consecutive winning sessions from April 2 through April 18 — the longest streak since 1992. What makes it remarkable is the psychological context: AAII individual investor surveys showed bearish sentiment outnumbering bullish for 9 straight weeks throughout this rally, meaning the people closest to the market were skeptical the whole way up. This is a classic wall-of-worry advance, where persistent pessimism and elevated hedging (put/call ratios remain defensively high) provide fuel for further gains as short sellers are eventually forced to cover. The S&P 500 crossed 7,000 for the first time on April 15, then 7,100 on April 18 — both levels that would have seemed implausible just six weeks ago when the market was in a panic over the Iran conflict and a potential Fed policy error. The Korea connection is direct: KOSPI outperformed US indices by more than 3 percentage points this week because it started from a deeper discount, having been hit harder by March foreign selling, and the same macro tailwinds (dollar weakness, lower oil, AI earnings) apply with amplification.

Theme 3 — Earnings Season Opens Strong: Financials Lead

The Q1 2026 earnings season kicked off with a string of blowout financial results. Morgan Stanley posted EPS of $3.43 against a $3.02 consensus — a 13.6% beat. Goldman Sachs reported near-record quarterly profits. BlackRock is closing in on $14 trillion in assets under management. JPMorgan beat the earnings estimate but guided lower on net interest income, a nuanced result that suggests peak banking margins may be fading even as headline profits remain strong. TSMC, the world's dominant semiconductor manufacturer, reported March revenue up +45% year-over-year and confirmed that AI server demand and HBM memory orders are accelerating, not plateauing. This directly supports the bull case for Samsung Electronics (005930) and SK Hynix (000660), the two biggest weights in the KOSPI, heading into their own earnings releases — SK Hynix reports April 23 with expectations of 40 trillion KRW (~$29.6 billion USD) in Q1 operating profit, which would be one of the highest quarters in company history.

3. Weekend Catch-up

These are things that happened after Friday close — markets have not priced any of this yet.

Item 1 — Islamabad Talks Collapse, Ceasefire Deadline Set for April 21

The second round of US-Iran peace talks in Islamabad ran for 21 hours before breaking down Friday night, US time. The two sticking points: the US military maintained a naval blockade of Iranian ports throughout the ceasefire, which Iran said violated the agreement, and the US insisted on nuclear inspection access before lifting any sanctions. Trump issued a warning immediately after the collapse: if no meaningful progress is made before April 21, he will declare the ceasefire void and resume hostilities. Monday open is a direct binary on this headline. If Trump declares the ceasefire broken before Asian markets open, expect WTI crude to spike back toward $90 and KOSPI futures to gap down 1-2%. If backdoor diplomacy produces a last-minute extension or framework agreement, the Friday rally resumes and KOSPI tests 6,300. Either scenario is fully in play — check the news before Monday open.

Item 2 — Iran Reimposed Partial Hormuz Restrictions

Hours after the Islamabad talks collapsed, Iran's Revolutionary Guard announced vessel inspections and delays for select shipping nationalities transiting Hormuz, citing the US naval blockade as justification. This is not a full closure, but it partially reverses the Thursday narrative that caused oil to crash -11.5%. Energy markets will react immediately when Asian sessions open Sunday night — watch Brent crude as the first real-time signal. If Brent spikes above $92 at the Asian open, the oil-inflation fear trade is back on and the sector rotation from last week reverses: energy stocks up, tech and consumer stocks down, and Korean refinery stocks (S-Oil 010950, GS Holdings 078930) catch a bid while export manufacturers face renewed cost pressure.

Item 3 — Polymarket Shows 50%+ Odds on Ceasefire Breach by April 21

The prediction market Polymarket — a platform where people bet real money on event outcomes — showed YES odds above 50% on Trump declaring a ceasefire breach before April 21. When prediction markets cross 50%, it typically means the event is being treated as a coin flip rather than a tail risk. The silver lining: markets have already moved significantly on this news cycle, which means some negative scenario is already priced in. A complete surprise escalation is more dangerous than a gradual deterioration. Conversely, a genuine diplomatic breakthrough this weekend — particularly if the UK, Saudi Arabia, or UN envoys broker a framework — would be a positive surprise that markets have not yet priced, potentially pushing futures higher before Monday open. Watch for joint statements from mediator countries Sunday afternoon.

4. Sector and Foreign Flow

The week's sector story was clean and decisive. Technology and financials were the two strongest US sectors — tech benefiting from the AI infrastructure investment cycle continuing uninterrupted, and financials driven by a string of blowout earnings reports from Goldman, Morgan Stanley, and BlackRock. Energy was the one clear loser: WTI crashed -14.5% on the Hormuz opening, dragging US energy stocks down 4-6% for the week. In Korea, the same template applied with amplification: semiconductors surged 5-8% as foreign investors poured money into Samsung Electronics (005930) and SK Hynix (000660), while defense names pulled back 3-4% as the geopolitical de-escalation removed the war premium — Hanwha Aerospace (012450) fell -3.88% on Thursday alone. Auto stocks (Hyundai Motor 005380, Kia 000270) caught a tailwind from lower energy costs, outperforming their US counterparts. For the coming week, semiconductors remain the most critical Korean sector to watch: SK Hynix reports April 23, and if operating profit clears 40 trillion KRW (~$29.6B USD) with strong HBM4 guidance, Korean tech names will extend their leadership regardless of the Iran noise.

Foreign investors bought a net ~1.42 trillion KRW (~$1.05 billion USD) in Korean equities this week, with the buying concentrated overwhelmingly in Samsung Electronics and SK Hynix — combined net purchases of these two names since April 1 have exceeded 4.8 trillion KRW (~$3.6B USD). That level of concentrated buying in two names within a single month is unusual and signals that foreign funds are making a deliberate macro bet on Korean semiconductors, not a broad-based Korea allocation.

Sector	US Weekly	Direction	Korea Linked Stocks	Korea Weekly	Notable Move
Semiconductors	+5~7%	▲▲	Samsung (005930), SK Hynix (000660)	+5~8%	SK Hynix intraweek +7.79%
Big Tech / AI	+4~5%	▲▲	NAVER (035420), Kakao (035720)	+1~2%	Oracle +5.13% on Bloom deal
Energy	-4~6%	▼▼	S-Oil (010950), GS Holdings (078930)	-1~2%	WTI -14.5% on Hormuz
Financials	+3~4%	▲▲	KB Financial (105560), Shinhan (055550)	+2~3%	Morgan Stanley EPS +13.6% beat
EV / Battery	Mixed	→	LG Energy (373220), Samsung SDI (006400)	-1~+1%	Tesla 6-week weakness weighs
Defense	-1~2%	▼	Hanwha Aerospace (012450), LIG Nex1 (079550)	-3.88% (Thu)	Geopolitical premium unwinding

📊 Earnings Highlights This Week

This was the first week of the Q1 2026 earnings season, and the financial sector set a strong tone. The overall S&P 500 earnings beat rate for early reporters stands at approximately 75%, in line with a typical earnings season (FactSet estimate). The most meaningful result for Korean investors was TSMC, whose +45% year-over-year March revenue growth directly validates the HBM and AI memory demand cycle that Samsung Electronics and SK Hynix are leveraged to.

Company	EPS Est	EPS Actual	Result	After-Hours
Goldman Sachs	$11.50	Record high	Beat	Strong
Morgan Stanley	$3.02	$3.43 (+13.6%)	Big Beat	Strong
JPMorgan	Beat	Beat	EPS beat, NII guidance cut	-1%
BlackRock	—	Strong	AUM near $14T	+2%
TSMC	—	March Rev +45% YoY	Big Beat	Semis rally

Next week key earnings: Tesla (TSLA) reports April 22 with EPS consensus $0.41 — the key question is whether EV demand has bottomed and whether autonomous driving revenue is materializing. SK Hynix (000660) reports April 23 with operating profit expectations around 40 trillion KRW (~$29.6B USD) — this is the single most important event for Korean tech stocks next week. Alphabet reports April 24-25 (EPS $2.01), and Meta reports April 29 (EPS $5.25).

⚠️ All earnings figures sourced via WebSearch. Some unconfirmed figures are estimates.

5. Crypto Corner and Kimchi Premium

Bitcoin climbed from approximately $71,000 to above $77,000 during the week (+8.5%), breaking through the critical $75,000 resistance level on April 14 and consolidating above it through Friday. The dominant driver was macro: the Iran geopolitical de-escalation removed the risk-off pressure that had been capping crypto, and the same broad risk-on wave that lifted equities lifted crypto in parallel. The biggest single-day move was Thursday April 17 — the same day Iran announced Hormuz open — when BTC broke $77K and ETH jumped over 4% in a single session. Ethereum actually outperformed Bitcoin this week at +8.6% to $2,377, driven by a 41% surge in on-chain activity — this is a meaningful signal because on-chain activity spikes reflect real usage expansion, not just financial speculation. When ETH outperforms BTC, it typically signals growing appetite for altcoins and DeFi applications beyond simple Bitcoin holding. Solana gained +6.2%, and all three major coins moving together suggests a broad-based crypto risk-on rotation rather than Bitcoin-specific flows. The Fear and Greed Index hit 61 (Greed) on April 18 — the first time in months the index has entered positive territory. Readings of 60-70 have historically corresponded to mid-bull-cycle stages where corrections are buyable dips rather than trend reversals. Total crypto market cap expanded from approximately $2.46 trillion to $2.66 trillion, a weekly gain of +8.1%, with Bitcoin dominance at 57.33%.

Coin	Week Open	Week Close	Weekly %	Key Driver
BTC	~$71,000	~$77,000	+8.5%	Iran risk-off removed, $75K breakout
ETH	~$2,188	$2,377	+8.6%	On-chain activity +41%, BTC outperform
SOL	~$145	~$154	+6.2%	Broad altcoin participation

Kimchi Premium: ~+0.8% as of April 19 morning KST — A quick explanation for those unfamiliar: Korean crypto exchanges (Upbit, Bithumb) often price Bitcoin and other coins at a premium to global exchanges like Binance. When Korean retail demand surges, locals bid up prices above the global rate — this spread is called the Kimchi Premium. A premium above +4% signals elevated local retail buying; a negative premium is unusual and suggests local selling pressure. The current +0.8% is modest positive — Korean retail is cautiously re-entering, not panic-buying, which is actually a healthier sign for sustained upside than a sudden +5% premium spike.

Fear and Greed: 61 — Greed — First reading in Greed territory in months. Historically, 60-70 zone is mid-bull-cycle where corrections are buyable, not exits.

Total Market Cap: ~$2.66 trillion (prev week ~$2.46T, +8.1% weekly). BTC dominance: 57.33%.

6. Next Week's Playbook

The single most important variable for next week is the April 21 ceasefire deadline — it outweighs earnings, macro data, and everything else on the calendar. If Trump declares the ceasefire broken before Asian markets open Monday morning, WTI crude spikes back toward $90, the entire inflation relief narrative from Thursday reverses, and the Nasdaq faces its first real test after 13 straight winning sessions. If backdoor diplomacy extends the ceasefire even informally, the Friday rally resumes and KOSPI tests 6,300 on continued foreign buying. The US market direction call is Cautious-to-Neutral: the fundamental backdrop remains strong — AI spending is intact, financial earnings are solid — but a binary geopolitical event on Monday creates a coin-flip for the first session of the week. The KOSPI directional call is the same Neutral stance: 6,100 is the key downside support (watch it if Iran news is bad), and 6,300 is the upside resistance (previous high from February). The Monday open indicator to watch, as always for Korean markets: the first 30 minutes of foreign investor net buy or sell in Samsung Electronics (005930). If foreigners are net buyers of Samsung in that window despite geopolitical uncertainty, the KOSPI rally tends to hold and extend. If they flip to selling Samsung, the open gap fades and 6,150-6,100 gets tested rapidly. The underappreciated risk heading into next week: Trump has used deadline threats as negotiating tactics before — the market already rallied once (Thursday) on Hormuz optimism. A second round of optimism buying followed by disappointment would be a more painful double-top than a straightforward escalation. The underappreciated opportunity: SK Hynix April 23 earnings — if operating profit clears 40 trillion KRW and HBM4 demand guidance is strong, Korean semiconductor stocks have a fundamentals-driven catalyst that is entirely independent of the Iran noise.

Date	Event	Consensus / Expected	Potential Market Impact
4/21 (Mon)	US-Iran Ceasefire Deadline	Extension or breach	Highest impact event of the week
4/22 (Tue)	Tesla (TSLA) Q1 Earnings	EPS $0.41	EV demand + autonomous driving update
4/23 (Wed)	SK Hynix (000660) Q1 Earnings	OP ~40T KRW (~$29.6B)	Direct KOSPI semiconductor catalyst
4/24 (Thu)	Alphabet (GOOGL) Q1 Earnings	EPS $2.01	AI Search monetization signal
4/28-29	FOMC Meeting	Hold at 3.50-3.75%	Rate cut signal timing critical

7. Dongchun's Weekly Parting Thought

The Hormuz opened, oil crashed, stocks hit records, and then the weekend talks collapsed — and yet the market knows this war ends. Trade accordingly.

KOSPI, Korean stock market, weekly market recap, Asian markets, Kimchi Premium, Bitcoin, crypto market, global macro, Samsung Electronics, EWY, weekly outlook, foreign investor flow, KOSDAQ, Korea ETF, weekend catch-up