June Buying Market for July Bull Run... Solid Bottom and Supply-Demand "Target Growth Stocks"

US Stock Market Shows July Uptrend in 5 Years Before COVID-19
Growth Stocks Should Be Targeted in June Ahead of Second Half
IT, Healthcare, Consumer Goods, Renewable Energy, and Eco-Friendly Themes

[Asia Economy Reporter Lee Seon-ae] In June, the domestic stock market reached an all-time high and experienced temporary volatility, leading to investment advice that this period is a good buying opportunity to prepare for the second half of the year. In particular, amid growing expectations for economic and corporate profit recovery due to the expanded distribution of COVID-19 vaccines, it is judged that growth stocks should be targeted at the current point in June, aligned with the seasonally bullish U.S. stock market in July. Related sectors include IT, healthcare, renewable energy, and eco-friendly themes that could benefit from the policies of the U.S. Joe Biden administration.

According to Daishin Securities on the 26th, the current stock market investment environment is a combination of accommodative monetary policies and expanded fiscal spending to overcome the pandemic, continued risk asset preference based on abundant liquidity, and autonomous economic recovery expectations due to vaccine distribution.

Moon Nam-jung, a researcher at Daishin Securities, said, "The U.S. stock market is highly likely to rise in July this year as well," adding, "At the current point in June, it is necessary to prioritize stocks with the July market rise in mind."

Looking at the average monthly returns of the U.S. stock market (S&P 500) during the five years before the COVID-19 outbreak from 2015 to 2019, the markets in May, June, and July recorded -0.1%, 1.2%, and 2.5%, respectively. This year, after a market correction in May, the market has shown an upward trend of around 1% in June, suggesting a similar seasonal pattern will be repeated. Since July recorded the highest annual returns over the past five years, it is explained that the U.S. stock market is highly likely to rise in July this year as well.

Therefore, ahead of the start of the second half, it was advised to target growth stocks at the current point. The reasons cited include lower inflation due to the high base effect in the second half of last year, the U.S. unemployment rate not returning to pre-COVID-19 levels, and factors limiting interest rate increases such as the possibility of increased savings rates during the U.S. driving season.

Additionally, it was forecasted that the investment environment favoring growth stocks will be created as cryptocurrency market regulations could lead to a return of funds to growth stocks with similar characteristics. The related sectors mentioned were IT, healthcare, and renewable energy, with eco-friendly and healthcare themes suggested.

Furthermore, it was noted that attention should be paid to beneficiaries of the U.S. new administration’s policies in the global stock market in the second half. Related sectors include IT, healthcare, consumer goods, and renewables, with eco-friendly themes such as low-carbon, electric vehicles, hydrogen vehicles, and infrastructure-related next-generation communications and healthcare themes highlighted.

Researcher Moon said, "The Biden administration maximized policy momentum through bold fiscal policy strengthening, which was the driving force behind the significant rise in the stock market in the first half," adding, "A market phase where strengthened fundamentals from crisis response in the second half overcome uncertainties is coming, and we prefer G2 and Asian industrial countries with high capacity for pandemic response and economic stimulus."

This content was produced with the assistance of AI translation services.