Fear market that struck instantly: Samsung Electronics strike, is it time to flee the stock market? / KOSPI, having escaped undervaluation, will eventually go 'here' | Director Lee Juyeon

Summary

Director Lee Juyeon explains the sharp KOSPI correction as a natural consolidation after rapid gains, driven by short-term overheating and external risks like Japan inflation and Samsung strike. He maintains a long-term bullish view on KOSPI, citing undervaluation (PER still below 10x) and a path to 10,000. However, he warns of a structural short gamma risk in US semiconductor leveraged ETFs that could amplify near-term volatility, especially impacting semiconductor-heavy markets like Korea.

• KOSPI dropped sharply due to short-term overheating and round-number profit-taking at 8,000 points.
• The 50-day price deviation above 130% historically signals a correction; current data aligns with that pattern.
• Fundamentals remain solid: KOSPI forward PER is still below the 10x historical average, implying a target of 10,000.
• Samsung Electronics' strike on May 21 is a short-term risk but likely resolvable without harming the long-term valuation thesis.
• US leveraged ETF assets have surged to $35bn, with 74% concentrated in semiconductors, creating severe short gamma risk.
• A 1% drop in the semiconductor index could force $10bn in mechanical selling, threatening further downside.
• Speaker advises against panic-selling and recommends using corrections to increase exposure for long-term investors.
• Next week's CTA flows could add additional downward pressure in the near term.