Semiconductors Shaking Again, KOSPI Box Range Breakout Signal

Summary

Hanwha Investment & Securities' team leader Park Seung-young argues that the KOSPI is trapped in a 5,500–7,300 range as leverage unwinds, and volatility will keep declining. He recommends a tactical range-trade on KOSPI, favors covered call ETFs, and sees the US market outperforming Korea due to better earnings momentum. He remains bullish on Korean memory semiconductors and select cheap sectors like shipbuilding, cosmetics, and refining, while avoiding robotics and autos.

• KOSPI is in a box range (5,500–7,300) driven by leverage unwind, with no fundamental trigger to break out.
• Volatility (VKOSPI) is falling and will return to historical averages, favoring covered call strategies on KOSPI.
• US equities should outperform Korea through year-end; trim Korea and add US to maintain a 50/50 portfolio.
• Korean memory semiconductors (Samsung, SK hynix) are a buy on weakness; the selloff is purely a supply/demand issue.
• Cheap KOSDAQ stocks are less pressured by leverage unwind and offer near-term opportunities.
• Alphabet (GOOGL) is attractive as a structural play on cloud margin expansion, similar to Apple in 2016.
• Korean shipbuilding, cosmetics/ODM, and oil refining sectors appear undervalued with solid earnings.
• Robotics and auto stocks face rate and currency headwinds and are best avoided for now.