Ideas
KOSPI to 5,800 on earnings
The KOSPI can reach 5,800 in 1H26 because 12-month forward EPS is rising faster than price. The market P/E has fallen to about 8.8x versus a long-term average near 10x, so even mean reversion with 27E earnings growth of about 12% implies further upside. Until forward EPS peaks, holding or buying dips is the right stance; semiconductor earnings upgrades are the main driver, and 2H risk factors should be monitored.
Semiconductor earnings uptrend remains intact
Semiconductors are the core KOSPI earnings engine: roughly 83% of the expected 190tn won increase in 2026 KOSPI net profit comes from semiconductors. Memory supply is tight, capacity expansion has stopped, prices are rising, and demand is explosive, so earnings forecasts keep getting sharply revised upward. The recent correction is a buying opportunity within an intact AI/semiconductor cycle.
Laggards rotate up during semiconductor pause
When KOSPI and semiconductor leadership rest, previously lagging domestic-demand and overlooked sectors outperform. In the November-December 2025 consolidation, 7 of 10 rising sectors had been laggards, and the same rotation is happening now. Cheap laggards include displays, chemicals, cosmetics, consumer staples, pharma/biotech, hotels/leisure, internet, and transport; this is a trading opportunity until growth/semiconductor leadership resumes, likely through early/mid March.
US indices favored for domestic stimulus
For US index exposure, the Dow and S&P 500 are more attractive than an indiscriminate Big Tech/AI basket. The 2026 midterm election year and a pending tariff Supreme Court ruling should push Trump toward domestic stimulus, favoring domestic-demand-heavy indices. Big Tech/AI has become differentiated, so it now requires individual stock selection rather than index exposure.
Big Tech AI needs stock picking
US Big Tech/AI no longer trades as a single bloc; performance has become highly differentiated since the late-2025 AI bubble and profitability debates. Investors who want AI/Big Tech exposure need a stock-specific approach rather than simple index or basket exposure.
WTI oil rebounds to $80
Oil is artificially suppressed by Trump-Saudi supply cooperation. After the US midterm election picture becomes clearer in November, that suppression should ease; WTI can rebound to $80 in Q4, a more than 30% gain. This would lift energy and broad commodity inflation and affect monetary policy.
Autos cheap with robot optionality
Autos are among the 2026 earnings leaders to keep holding. Valuations are cheap, robotics adds a new growth angle, and foreign selling has already passed a climax; foreign investors are turning back to net buyers in autos.
Secondary battery rebound has room
Secondary batteries are an underappreciated earnings leader. EV demand should recover as the US, China, and Europe economies improve; Chinese restructuring is cutting supply; and robot-related battery demand is an emerging option. After the crash, the sector has retraced only about 35% of the decline, leaving 40%+ upside if it retraces half and 60%+ at the 61.8% level.
Steel is an earnings leader to hold
Steel is also among the sectors with strong 2026 operating-profit and net-profit contribution and should be held alongside semiconductors, autos, and secondary batteries. Base-metal price moves and Chinese production cuts could provide additional support later.
Internet, biotech rebound on rate cuts
Internet and pharma/biotech are likely 1H26 rebound sectors because they are overlooked, earnings are being revised up, valuations are below historical averages, and their relative strength is inversely correlated with bond yields. Bond yields are overpricing rate hikes; as rate-cut expectations revive on Fed and Bank of Korea policy shifts, these rate-sensitive growth sectors can rebound.
Korean bond yields can fall further
Korean bond yields are too high because the market is over-worried about rate hikes. As the won stabilizes below 1,450 and property prices soften, the constraints that blocked Bank of Korea cuts are weakening. Even without an actual BOK cut, the market can price in cuts and pull KTB yields below 2.8-3.0%; a 50bp+ decline would help growth stocks and the KOSDAQ.
KOSDAQ outperforms if yields fall
For family and retail investors, he recommends simply buying KOSPI and KOSDAQ ETFs rather than trying to trade individual stocks. If US equity exposure is too high, shifting some toward Korea is reasonable now, especially with tax benefits.
Follow February foreign-pension co-buying sectors
In February, sectors jointly bought by foreign investors and the National Pension Service were cosmetics, banks, secondary batteries, energy, utilities, IT appliances, insurance, essential services, steel, and construction. These flow patterns are a useful tactical tip while the market consolidates in February.
Use sector ETFs instead of stock picking
For investors who cannot pick individual stocks, use sector ETFs instead—semiconductor, secondary battery, internet, and automobile ETFs—to capture the strong earnings themes with diversification. He also suggests equal-weighting a basket of good sectors and rebalancing back to equal weights as they diverge.
Gold, silver cycle has ended
The big money-making market for gold and silver is over. They may still rise, but the current cycle has ended, so the risk/reward is no longer attractive.
Shift commodity focus to base metals
The easy money phase in gold and silver is over, so commodity attention should shift to base/non-ferrous metals, which are more economically sensitive and can be supported by Chinese production cuts. If base metals move, steel, chemicals, and secondary materials equities can move as well.
Grains are cycle's last leg
The final stage of the commodity cycle is likely to be agricultural/grains, but not now. He expects that phase around late this year or next year.
This 3PRO TV (삼프로TV) video, published February 10, 2026,
features Lee Gyeong-min
discussing EWY, Korean semiconductor sector, Korean domestic-demand and laggard sectors, DJI, SPY, AI-SECTOR, WTI, CARZ, Korean secondary battery sector, Korean Steel Sector, Korean internet sector, XLV, Korean government bonds, KOSDAQ, Korean foreign/pension co-buying basket, SMH, Korean secondary battery ETF, Korean internet ETF, Korean automobile ETF, GLD, SILVER, DBB, Korean chemicals sector, Secondary materials, DBA.
17 trade ideas extracted by AI with direction and confidence scoring.
Speakers:
Lee Gyeong-min
· Tickers:
EWY,
Korean semiconductor sector,
Korean domestic-demand and laggard sectors,
DJI,
SPY,
AI-SECTOR,
WTI,
CARZ,
Korean secondary battery sector,
Korean Steel Sector,
Korean internet sector,
XLV,
Korean government bonds,
KOSDAQ,
Korean foreign/pension co-buying basket,
SMH,
Korean secondary battery ETF,
Korean internet ETF,
Korean automobile ETF,
GLD,
SILVER,
DBB,
Korean chemicals sector,
Secondary materials,
DBA
