The KOSPI index has moved away again from the 8,000-point "peak." On the 15th, the KOSPI touched 8,000 points and immediately plunged 6%, falling below the 7,500 level. With overheating fears from a rapid short-term surge and domestic and external risks still in place, investors are focused on whether the market can reach "pal-cheon-pi" again this week.
This week (the 18th-22nd), volatility is expected to be as large as last week. The U.S.-Iran agreement remains at an impasse, and in Korea, concerns are rising that the Samsung Electronics strike risk could be prolonged.
Last week, the KOSPI index continued its upward trend on the back of a tech rally in the U.S. market and expectations for improvement in the memory cycle. Samsung Electronics and SK hynix climbed to the "290,000 Jeonja" and "2 million Nix" milestones.
But the path to 8,000 points was not entirely smooth. With domestic and external risks such as the Middle East war and the Samsung Electronics strike persisting, the index swung widely after being compounded by Kim Yong-beom, the Blue House policy chief's "national dividends" remarks on the 12th. The index topped 8,000 intraday on the 15th but then fell and closed at 7,493.18.
The biggest event this week is Nvidia's earnings release on the 20th. As Big Tech corporations such as Microsoft (MS), Amazon and Google continue to ramp up investments in artificial intelligence (AI), competitors like AMD and Intel also beat expectations. Attention is on whether Nvidia will also deliver a "surprise" result.
Nvidia's earnings will likely be a key variable for investor sentiment in AI-related stocks, including Samsung Electronics and SK hynix.
Na Jeong-hwan, a researcher at NH Investment & Securities, said, "Key points to watch in Nvidia's earnings are whether guidance reflects China sales, the durability of Blackwell demand, whether supply bottlenecks are easing, and the possibility of margin defense," adding, "In particular, we should focus on the corporation's position on whether the resumption of China sales is a sustainable trend."
On the 21st, minutes from the Federal Open Market Committee (FOMC) meeting of the U.S. Federal Reserve held last month will be released. At the April meeting, 3 of the 12 members supported holding rates but reportedly opposed retaining the dovish-leaning language. Analysts say that if the minutes confirm the influence of hawkish members, expectations for rate cuts could be further dampened.
Kim Yu-mi, an economist at Kiwoom Securities, said, "If, as recently, inflation indicators continue to exceed expectations, hawkish members may gain more influence," adding, "We need to gauge the Fed's internal mood and policy direction through these minutes."
Domestically, the Samsung Electronics strike risk is a major variable. With the Samsung Electronics union announcing a general strike on the 21st, the possibility of the government invoking emergency adjustment powers is being discussed. Researcher Na said, "If there is a deal, expense burdens are a concern, and if there is a strike, it could lead to production disruptions, which will weigh on Samsung Electronics' earnings."
Whether sector rotation emerges is also a key factor in reclaiming 8,000 points. The domestic market surged rapidly to 8,000 points last week, but on the 15th, when the two semiconductor bellwethers, Samsung Electronics and SK hynix, fell more than 8%, it was pushed back to the 7,500 level.
Yoo Myeong-gan, a researcher at Mirae Asset Securities, said, "The deepening tilt toward large caps is a burden," adding, "The KOSPI's 12-month forward price-earnings ratio (PER) is 8.1 times, making valuations attractive, but excluding Samsung Electronics and SK hynix, it is 11.5 times, above the historical average of 10.0 times."
In the securities industry, KOSPI forecasts are being raised one after another. KB Securities set this year's KOSPI target at 10,500 points.
Lim Jeong-eun, a researcher at KB Securities, said, "There is a possibility of a short-term correction due to overheating in the short term," but added, "It is unlikely that signs of a bubble burst, such as a collapse of the business cycle or a sharp surge in interest rates, will appear in the near term."