The Key to Extending the AI Cycle Is 'Diffusion'; What Are the Conditions for a Longer Boom? | Shin Jung-ho, Head of LS Securities Research Center

AI사이클 연장의 핵심은 '확산', 호황길어지기 위한 조건은? | 신중호 LS증권 리서치센터장 [글로벌 인터뷰]

Watch on YouTube ↗ | February 02, 2026 at 23:04 | 35:56 | 3PRO TV (삼프로TV)

Speakers

Shin Jungho — Head of Research Center, LS Securities

Summary

Shin Jung-ho, Head of Research Center at LS Securities, argues that the AI cycle can extend only if adoption diffuses beyond mega-cap technology, but near-term funding costs and high rates are constraining that diffusion. He expects global semiconductor and AI capex momentum to peak around Q2 2026, with Korean and U.S. markets digesting gains through a volatile period correction. He highlights Nvidia, Samsung Electronics, Palantir, Big Tech capex, Oracle CDS, and the KOSPI as key monitors.

U.S. manufacturing PMI strength and elevated inflation expectations are pushing Fed rate-cut expectations to 2H or 3Q.
Korean market volatility is amplified by Samsung Electronics and SK hynix accounting for nearly 40% of KOSPI.
Shin expects a 2-3 month period correction or range, with KOSPI below 4,500 seen as a dip-buying level.
AI capex growth momentum is expected to peak in Q2 2026, pressuring global semiconductor sales momentum near term.
Big Tech capex is increasingly debt-funded while buybacks and dividends decline, making mega-cap tech more rate-sensitive.
Nvidia's next move depends on easing Oracle CDS stress and broader third-party AI funding.
Palantir's guidance confirms AI demand, but its valuation limits near-term upside.
Longer-term AI capex can re-accelerate in 2027 if lower rates let non-mega-cap companies adopt AI.

Ideas

Shin Jungho Head of Research Center, LS Securities 10:40

Korean market range-bound with dip-buying.

After a more than 20% January surge, Korean market turnover and late-arriving leveraged money are elevated. Samsung Electronics and SK hynix together are near 40% of KOSPI, so their swings can dominate the index and create larger volatility than in the U.S. He expects a sideways or period correction over the next two to three months, with the index likely contained in a 5-7% range around 5,000; if it breaks below 4,500, ample sidelined cash makes it a buying opportunity. Investors should not chase and should keep cash to buy dips or rotate into laggards.

Shin Jungho Head of Research Center, LS Securities 15:24

AI cycle extends on broader diffusion.

The AI investment cycle can extend if AI adoption diffuses beyond the mega-cap technology companies. For that diffusion to happen, funding costs must fall so non-M7 and legacy companies can borrow and spend on AI. Near-term capex growth may peak in Q2 2026, but lower rates could allow a re-acceleration in 2027. This makes the long-term AI infrastructure theme positive, even though the near term is a digestion and consolidation phase.

Shin Jungho Head of Research Center, LS Securities 16:58

Nvidia needs Oracle credit stress to ease.

Nvidia has shifted from a pure chip supplier to an ecosystem financier, and its stock has been range-bound since August as investors worry about circular financing with customers such as Oracle. The key monitorable is Oracle's CDS: if Oracle CDS falls and third-party financial or strategic investors fund AI demand, Nvidia can break out again; if Oracle CDS rises, Nvidia and the AI trade remain under pressure.

Shin Jungho Head of Research Center, LS Securities 17:20

Oracle CDS gauges AI funding stress.

Oracle's CDS spread is a useful gauge of AI financing stress. Oracle is a major Nvidia customer and has been increasing debt-funded AI investment; when its CDS widens, Nvidia and the broader AI trade weaken. If Oracle CDS narrows, it would signal easier funding and could revive the AI investment trade.

Shin Jungho Head of Research Center, LS Securities 22:18

Big Tech capex funding becomes rate-sensitive.

M7 capex guidance has increased, but the capex-to-operating-cash-flow ratio has climbed to around 70%, and large tech companies are increasingly using debt to fund capex while buybacks and dividends decline. This makes mega-cap tech more sensitive to high rates and reduces the buyback support that previously cushioned the U.S. market, so the group faces near-term consolidation even as AI capex remains high.

Shin Jungho Head of Research Center, LS Securities 22:38

Semiconductor momentum peaks in Q2 2026.

Global semiconductor sales growth is tied to the momentum of mega-cap AI capex growth. Because M7 capex growth is expected to peak around Q2 2026 and decline in 3Q and 4Q, global semiconductor sales momentum should also peak in Q2, implying a period of adjustment. The cycle can re-accelerate later if rates fall and AI adoption broadens.

Shin Jungho Head of Research Center, LS Securities 24:52

Samsung profit growth peaks in Q2 2026.

Samsung Electronics' operating profit growth rate is expected to peak in Q2 2026, similar to the global semiconductor capex and sales cycle. During that peak-digestion period, the stock may fall or move sideways, so investors should tolerate a consolidation phase rather than chase the stock.

Shin Jungho Head of Research Center, LS Securities 30:28

Palantir too pricey, range-bound.

Palantir's strong guidance and after-hours gain confirm that AI demand has not ended, but the stock is too expensive and is not valued on traditional metrics. The report is unlikely to become a fresh catalyst for broader AI spending, and he expects the shares to neither collapse nor rally meaningfully, staying range-bound.

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This 3PRO TV (삼프로TV) video, published February 02, 2026, features Shin Jungho discussing EWY, AIQ, NVDA, Oracle CDS, MAGS, SMH, 005930.KS, PLTR. 8 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Shin Jungho · Tickers: EWY, AIQ, NVDA, Oracle CDS, MAGS, SMH, 005930.KS, PLTR