Was the July Correction an Opportunity? Why You Should Focus on 'Sector Rotation' Now | Lee Kyung-soo, Hana Securities Research Center Senior Research Fellow

Summary

Lee Kyung-soo of Hana Securities Research Center argues the July correction was a buyable dip for Korean equities, with KOSPI around 2,600-2,700 offering attractive long-term entry. He sees falling rates and recovering risk appetite driving a healthy rotation from first-half winners into beaten-down areas like biotech and into earnings/dividend stocks. He also notes foreign supply conditions are stabilizing and US markets are rotating toward laggards, supporting a more diversified second-half strategy.

• Sees the July correction as a buyable dip rather than the start of a bear market.
• Says KOSPI around 2,600-2,700 is a probabilistically attractive entry zone.
• Notes global and Korean earnings remain solid while rates stabilize.
• Highlights improving biotech/pharma earnings estimates and a sector rebound.
• Prefers August-October rotation into earnings and dividend stocks over concentrated winners.
• Points to foreign inflows, stronger won, lower volatility, and a shift toward index ETFs as stabilizing supply.
• Observes US market rotation into laggard/beaten-down factor.
• Cautions semiconductor earnings growth is decelerating in H2 but does not call for avoiding semis.