Global Fund Managers Are Filling Up on Stocks Right Now | Executive Director Park Se-ik & Chesley Investment Advisory [Morning Brief / 26.08.19.Wed]

Summary

Park Se-ik and Choi Ho review market conditions on August 19. They see global long-end yields rising, bond allocations being cut, and Korean equities in a box-range correction until the late-October US midterm elections. They are cautious on semiconductor positioning but view mid-September weakness and SK hynix below 1.4 million won as buying opportunities, and they expect next year's Korean market to be strong.

• Bitcoin and crypto weakness around US midterm election years is flagged as a risk.
• Global 30-year yields in the US, Germany, France and Japan are rising, supporting bond underweight.
• Korean equities are expected to remain in a range correction until around late October.
• Defense and other structural growth names are preferred for valuation-based range trading.
• Semiconductor exposure should be trimmed to market weight in H2 due weakened valuation re-rating.
• Mid-September semiconductor weakness is viewed as a potential buy for October earnings recovery.
• SK hynix below 1.4 million won is considered attractive.
• Next year Korean equities are expected to be strong.