How should we respond to this rebound? | Jang Woojin, Geumsigong CEO [Weekend Interview]

Summary

CEO Jang Woo-jin analyzes the historic July 31 KOSPI surge, attributing it to the end of global deleveraging and forced selling by a collapsed leveraged hedge fund. He argues that semiconductors will lead the rebound, emphasizing SK Hynix's undervaluation, and advises investors to watch Monday's short-covering strength to assess the rally's durability while maintaining cash reserves.

• July's extreme volatility was amplified by global deleveraging and the liquidation of a highly leveraged AI-focused fund.
• The KOSPI rebounded sharply by nearly 18% in one day, led by semiconductor heavyweights hitting upper price limits.
• AI capex concerns eased after Amazon's conference call showed quick investment returns, supporting continued memory demand.
• Semiconductor sector is expected to drive the recovery, backed by supply shortages through 2028 and strong earnings growth.
• SK Hynix appears undervalued near 1x PBR with a three-year cumulative earnings outlook of 600-700 trillion won.
• Monday's trading will be pivotal: strong extension confirms continued upside, while weakness would indicate exhausted short-covering and further correction risk.
• The government's new strategic fund plan is minor and unlikely to be a major market catalyst.
• Investors are urged to maintain cash and avoid excessive leverage while staying alert to geopolitical and macro risks.