There are no stocks that rise forever in the world. As the KOSPI index sets its sights on new heights, the securities that had surged are now undergoing a steep correction, and profit-taking activities are emerging for SK hynix, which was playing the role of the 'leading stock' instead of Samsung Electronics.
Although there has been a brake on the sectors that had been leading the market, the domestic stock market's upward trend continues. This is a typical rotational trading market. As the stocks that rose significantly take a breather, buying interest is concentrating on relatively less appreciated stocks, indicating a new opportunity for investors. The relative strength of the KOSDAQ index while the KOSPI index wavers can also be understood as rotational trading.
Lee Woong-chan, a researcher at iM Securities, expressed the current situation as "even though valuations are at a high point, funds wanting to buy stocks are coming in, whether they are from individuals or foreigners."
Moreover, the keyword rotational trading is valid not only within the domestic stock market but also from a global perspective. The possibility of rotational trading among global markets has also been mentioned. Experts warn that one should not underestimate the impact of high tariffs amid the U.S. stock market consistently hitting all-time highs.
The adjustment in the U.S. stock market may appear to be bad news for our country's emerging market, but there are analyses suggesting it could represent an investment opportunity. Lee Eun-taek, a researcher at KB Securities, noted, "When looking at the S&P 500 chart from an inflation-adjusted perspective over the past 100 years, adjustments and recoveries repeat, and the adjustments in the leading U.S. market have shifted the flow of global markets. The adjustment in the S&P 500 can provide opportunities for other markets."
When the U.S. stock market fell during the 'Nifty Fifty Bubble' in the 1960s, funds flowed into the Japanese stock market and real estate, and during the 'dot-com bubble' in the 2000s, money was funneled into emerging markets in South America and Asia.
Lee Eun-taek mentioned, "The S&P 500 index is currently approaching a level where it could show corrections," adding, "We can expect global rotational trading."
However, simply expecting a rebound in all stocks just because they haven't risen in a while could lead to disappointment. Even if rotational trading occurs, there won't necessarily be a 'target match' across all sectors. What is crucial is performance. Joe Jun-ki, a researcher at SK Securities, stated, "The recent active rotational trading is strongly characterized by weight adjustment and profit realization," and added, "The key variable is the second-quarter performance."