Timothy Moe

Timothy Moe said Goldman Sachs remains constructive on Korea, with 130% earnings growth forecast for 2026 and the market trading at less than 8 times earnings, offering attractive risk-reward. Despite near-term pressures from the oil shock, Korea's strong semiconductor exports and current account surplus provide flexibility, and the market is overly negative on policy tightening. Korean equities are undervalued with high growth potential, making them a bullish opportunity for longer-term investors. Escalation in the Iran war or prolonged oil shock could further dampen sentiment and growth.

Moe notes global defense spending is structurally rising (Europe to 2.5% GDP, US to $1.5T). He explicitly likes the Defense theme "long-term." While Moe mentions Korean defense specifically, the macro driver applies globally. The Iran conflict reinforces the narrative that kinetic war is a persistent risk, ensuring government budgets for defense contractors remain elevated and immune to cyclical cutting. LONG. Defense is a multi-year secular growth story accelerated by current events. Supply chain constraints or government budget caps.

The AI hardware supply chain, especially semiconductor memory and foundry (Samsung, TSMC), is in a stronger-for-longer cycle than typical. The recent sharp correction makes it highly attractive, with high conviction that the cycle extends as AI demand sustains.

China's strategic push for self-reliance in technology, energy security, and its five-year plan emphasis on domestic supply chains creates investment opportunities in Chinese equities, particularly in tech and renewable energy sectors, as China decouples from reliance on foreign chokepoints.

The AI hardware supply chain, especially semiconductor memory and foundry (Samsung, TSMC), is in a stronger-for-longer cycle than typical. The recent sharp correction makes it highly attractive, with high conviction that the cycle extends as AI demand sustains.

Onshore Chinese equities (A-shares) deserve an overweight allocation relative to offshore China internet stocks, because onshore markets are delivering clear earnings growth tied to tech hardware and broader domestic recovery, while offshore China remains plagued by weak consumption, intense competition, and disappointing earnings. Earnings delivery is the best explainer of market performance, and onshore China is showing much stronger execution.

Taiwan has been raised to overweight. Profit growth is robust at 45% this year and about 30% next year. About 85% of the Taiwan market has direct revenue exposure to AI, making it a prime beneficiary of the continuing AI capex cycle. Valuations are reasonable given the growth outlook.

Moe identifies "Power" as a key theme, specifically linking it to AI buildout requirements. He states, "We like the Nuclear theme." High oil/gas prices (due to the war) improve the relative economics of nuclear energy. Furthermore, the "AI Power" trade requires baseload power that renewables cannot fully provide, making uranium miners and nuclear providers essential infrastructure plays. LONG. Convergence of Energy Security (War) and Tech Demand (AI). Regulatory hurdles or safety incidents dampening sentiment.

Moe identifies "Power" as a key theme, specifically linking it to AI buildout requirements. He states, "We like the Nuclear theme." High oil/gas prices (due to the war) improve the relative economics of nuclear energy. Furthermore, the "AI Power" trade requires baseload power that renewables cannot fully provide, making uranium miners and nuclear providers essential infrastructure plays. LONG. Convergence of Energy Security (War) and Tech Demand (AI). Regulatory hurdles or safety incidents dampening sentiment.