Will Semiconductors Go Further or Break? The Destination of Money in the Second Half Depends on 'This' | Hong Seonae, Han Sanghee, Hanwha Investment & Securities Senior Research Fellows

Summary

Han Sang-hee, Senior Research Fellow at Hanwha Investment & Securities, argues the sharp KOSPI sell-off is a structural distortion from memory concentration and not a fundamental crisis. He expects US liquidity and AI investment momentum to keep the market favourable through Q3, triggering sector rotation from over-owned memory stocks into Korean biotech, domestic banks, and consumer sectors. He also notes US hyperscalers have become more attractively valued after recent declines and highlights ASML and TSMC earnings as key upcoming signals.

• KOSPI correction is mostly due to index concentration in two memory stocks, not a macro breakdown.
• US biotech rally and resilient economic data point to a rotation, not a bear market.
• Korean biotech presents a catch-up opportunity versus US peers as the divergence is historically unusual.
• Domestic sectors like banks and consumer goods should benefit as capital rotates out of consolidating memory stocks.
• US hyperscalers (NVDA, MSFT, NFLX) look cheaper after sell-offs and offer a reasonable rotation from memory.
• ASML and TSMC Q2 earnings will be critical for gauging AI and memory equipment demand direction.
• Risk management is emphasized; avoid leveraged products in high-volatility environments.