Unpredictable Stock Market... Relatively Resilient Reopening Themes Draw Attention

[Asia Economy Reporter Lee Seon-ae] As geopolitical risks in Ukraine resurface and global stock markets show weakness, domestically, content and metaverse themes, and overseas, infrastructure and healthcare innovation themes are relatively holding up well. Despite the sharp increase in COVID-19 cases, expectations for economic reopening continue, leading consumption-related themes to record better returns compared to the market.

On the 25th, Seol Tae-hyun, a researcher at DB Financial Investment, stated, "Based on expectations for economic reopening, content theme ETFs are rebounding," adding, "Entertainment content sectors such as HYBE, SM, and CJ ENM have an absolute weighting, and webtoon & drama-specialized companies like Naver and Kakao also account for 25% of the portfolio."

However, for the entertainment content sector with high portfolio weighting, while the 2022 revenue forecasts are being revised upward, operating profit forecasts are being adjusted downward. Companies with upward revisions in 2022 Q1 and full-year operating profit forecasts since February include SM and Studio Dragon.

Among the long-term price momentum leaders are Chinese electric vehicles, domestic games, secondary batteries, and content. Mid-term price momentum leaders continue to include travel and leisure, global infrastructure, while the China consumption theme, with high weighting in cosmetics and travel sectors, newly entered. During bear markets, when temporary concerns ease and a bear market rally occurs, the inverse price momentum factor works well. Short-term price momentum leaders include overseas cloud and metaverse themes.

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