The Q4 Bull Market Reversal Begins: Q3 Is the Bottom Confirmation Period – The Leading Stock That Will Soar First Is ‘This’ | Moon Nam-joong, Senior Research Fellow

Summary

Moon Nam-joong, Senior Research Fellow at Daishin Securities, argues that Korean equities will bottom in Q3 and stage a powerful recovery from Q4 led by semiconductor giants Samsung Electronics and SK hynix, driven by a 9-year AI investment cycle. He also sees a short-term tactical bounce in secondary battery stocks and advises investors to avoid the KOSDAQ.

• The Fed is expected to cut rates in Q4, providing a catalyst for a market reversal after a weak Q3.
• The AI revolution is projected to last at least 9 more years, fueling continued hyper-scaler capex and supporting semiconductor demand.
• Samsung Electronics and SK hynix are identified as the primary leaders for the next rally, with current dips viewed as buying opportunities.
• The KOSPI will outperform KOSDAQ; large-cap stocks, especially semiconductors, will dominate the recovery.
• The secondary battery sector, heavily beaten down, may offer a tactical bounce on earnings turnaround expectations, but requires a short-term approach.
• Leveraged ETF unwinding is largely complete, reducing volatility headwinds and supporting the bottoming process.