Even if there's a rebound, only 'this' rose in the first half, a rebellion will occur in the second half | Hong Seon-ae, Park Byeong-chang, MP Partners CEO

Summary

Park Byeong-chang, CEO of MP Partners, analyzes the recent sharp sell-off in Korean equities. He notes that KOSDAQ has entered a panic-selling phase with declines typical of crisis periods, driven by sentiment and leverage products. He argues that large-cap semiconductor stocks, which dominated the first half, are likely to stall, and that historical patterns suggest a rotation into oversold KOSDAQ and small-cap names in the second half. He reviews risk factors and concludes that the market is in a correction, not a bear market, and that investors should prepare for a sector shift.

• KOSDAQ index has fallen 35% from highs, a decline usually associated with financial crises, signaling extreme fear and potential capitulation.
• Selling pressure is not driven by fundamental deterioration but by forced deleveraging from leveraged products and sentiment.
• Large-cap semiconductor stocks Samsung Electronics and SK hynix, leaders in H1, are showing signs of stalling and may consolidate in a box range.
• Historical patterns show that when large-cap leaders stall, KOSDAQ and small-cap stocks often stage strong rallies in the subsequent months.
• Institutional money is expected to rotate into oversold names where upside potential is higher and downside appears limited.
• Key macro risk factors including US interest rates, inflation, and AI investment efficiency are not deteriorating, supporting the view of a correction not a bear market.