[MarketING] Focus on Individual Themes Rather Than Indices... Pay Attention to Specific Stocks

KOSPI Weighed Down by Fatigue Likely to Move Within a Box Range for a While
Individual Stock Market to Continue

[Asia Economy Reporter Song Hwajeong] The KOSPI, which had risen rapidly, appears to be taking a breather. While the KOSPI is expected to move within a range for the time being, the stock-specific market trend that has continued so far is anticipated to persist.

KOSPI Turns Bearish After 10 Days

As of 10:20 AM on the 17th, the KOSPI was at 2,390.79, down 9.07 points (0.38%) from the previous day. This marks a bearish turn after 10 days. The KOSDAQ fell 2.43 points (0.34%) to 714.46. The KOSPI started the session touching the 2,400 level but soon turned downward, fluctuating within a range in the early trading hours.

Given the steep rise so far, it seems to be taking a breather due to fatigue. The KOSPI, which had recorded nine consecutive days of gains, rose 7.31% compared to the end of last year.

Han Jiyoung, a researcher at Kiwoom Securities, said, "Due to profit-taking following the recent short-term rise and the impact of economic indicators from China scheduled to be announced during the session, a range-bound market is expected."

So far, the stock market has moved more based on individual stock issues rather than a clear direction, and this individual stock market trend is expected to continue. Kim Younghwan, a researcher at NH Investment & Securities, said, "With conflicting factors such as the momentum of falling inflation and uncertainties ahead of the U.S. Federal Open Market Committee (FOMC), a theme- and stock-specific market will continue within a range-bound market lacking a clear direction."

Ongoing Stock-Specific Market... Focus on Individual Themes

Since the market is moving mainly based on individual thematic factors, attention should be paid to individual themes to respond to the stock-specific market.

Researcher Han said, "Although sector rotation continues in the domestic stock market recently, the price movements among leading rotation sectors are unfolding based on unique factors of each sector without common top-down characteristics. The overall upside for large-cap stocks is limited, and short-term trading markets will be created centered on individual thematic factors such as the UAE investment theme following President Yoon Seok-yeol's state visit, the China reopening (economic activity resumption) theme, and the robot theme."

However, since rotation is happening rapidly, the strategy of following themes is considered ineffective. Researcher Kim said, "A characteristic of the recent stock-specific market is that rotation is very fast. The strategy of following already moving themes is not effective." He added, "It is necessary to preemptively buy stocks in sectors considered promising themes and reduce exposure when prices rise. Attention should be paid to policy themes such as media and content, overseas construction, defense, nuclear power, and technology sectors like artificial intelligence and robotics."

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