Kospi's Disappearing Trading Volume, Don't Expect Leading Stocks for a While

Summary

Hwang Yu-hyeon, Team Lead at Shinhan Investment Securities, discusses the Korean stock market environment where trading volume has collapsed and no clear leading sector is visible. He explains that the market is normalizing after extreme volatility, with a rotation from large-cap semiconductors toward semiconductor equipment/materials and cosmetics exporters. He provides a tactical short-term bullish call on Samsung Electronics and SK Hynix due to options expiry, while warning that a breakdown below SK Hynix's July low would be a serious bearish signal.

• Trading volume is extremely low as investors lack confidence and no leading sector has emerged.
• The market is moving from extreme concentration in Samsung and SK Hynix to a more balanced normalization.
• Korean semiconductor equipment & materials stocks are favored because they show revenue growth and better valuations after the sell-off.
• Cosmetics exporters such as Amorepacific and LG Household & Health Care are breaking out on strong export data and market normalization.
• SK Hynix is at a critical support of 1,246,000 won; a break below that level would be a major bearish breakdown and warrant aggressive stop-loss.
• For the very short term, foreign options positioning may push Samsung Electronics and SK Hynix higher this week, creating a tactical buy.
• Averaging down on large-cap semis is discouraged; holding is okay but adding only if a strong catalyst appears.
• No dominant leading sector is expected soon; the market remains a stock-picker's environment.