July 29 Closing Market Conditions: Market Reacted Before Earnings... What Signals Did Investors Miss? | Hong Seonae, Lee Kwon-hee, Jang Woo-jin

Summary

On July 29, 2026, the Korean market experienced extreme volatility with KOSPI and KOSDAQ hitting circuit breakers for the second consecutive day, driven by disappointment in SK hynix's earnings call, geopolitical tensions from an Iranian attack, and forced liquidations. Experts noted that the sell-off was overdone, with valuations compressed and institutional buying emerging, suggesting a technical rebound is likely. Specific opportunities identified include an oversold bounce in SK hynix, defensive KT&G, value in Pharma Research, a robotics theme from US-China sanctions, and cheap cosmetics ODMs.

• KOSPI plunged to near 5,200 intraday before closing at 5,663, with individual investors selling heavily.
• SK hynix's earnings call lacked details on LTAs and dividends, triggering panic selling that spread across the market.
• Iranian first strike on US assets added geopolitical uncertainty, compounding the sell-off.
• National Pension Service and foreign investors bought futures and options, signaling a potential bottom.
• Korean robot stocks rallied on news of US sanctions against Chinese robots, benefiting Rainbow Robotics and SPG.
• Defensive names like KT&G and value plays like Pharma Research were highlighted as relative safe havens.
• Cosmetics ODMs (Kolmar, Cosmax, Cosmeca Korea) are trading at historically low multiples and may re-rate.
• Experts advised against panic selling, expecting a rebound but not a V-shaped recovery; they recommend using strength to reduce positions if needed.