From End-of-War Hopes to Earnings Optimism...KOSPI Hits New All-Time High Again

KOSPI Surpasses 6,350 Points...Breaks Pre-War High
SK hynix Surpasses 1.22 Million Won, Hits All-Time High
Gains Accelerate on Expectations for Major Companies' First-Quarter Earnings

On the 21st, when the KOSPI reached its highest point of the year, dealers were working in the dealing room at the Hana Bank headquarters in Seoul. Photo by Yonhap News.

Following the possibility of an end to hostilities between the United States and Iran, along with rising expectations for improved earnings among domestic companies, the KOSPI surpassed its all-time intraday high. With semiconductor companies such as Samsung Electronics and SK hynix leading the way, the KOSPI's continued rise has fueled projections that it could climb past 7,000 points and even reach 8,000 points in the future.

KOSPI Surpasses 6,350 Points...Breaks Pre-War High

On April 21, the KOSPI opened at 6,302.54, up 1.34% from the previous trading day, and extended its gains, trading at 6,340.37 as of 10 a.m., up 1.95%. At one point during trading, the KOSPI surged to 6,355.39, breaking the previous all-time intraday high of 6,347.41 recorded on February 27, just before the outbreak of the Iran conflict, marking a new record after about two months. The KOSDAQ opened at 1,186.23, up 0.97%, but reversed course and was down 0.12% at 1,173.41 as of 10 a.m. The won-dollar exchange rate started the session at 1,472.4 won, down 4.8 won from the previous trading day, and was trading in the 1,471 won range.

Despite a slight decline on the New York Stock Exchange overnight due to profit-taking in technology stocks, the Korean stock market is showing strength, buoyed by expectations for the first-quarter earnings season. On April 20 (local time), the Dow Jones Industrial Average fell 0.01% from the previous close, while the S&P 500 and the Nasdaq dropped 0.24% and 0.26%, respectively. Analysts attribute this to lingering uncertainty in the Middle East and fatigue from the Nasdaq's surge, having risen for 13 consecutive trading sessions through the previous day.

Suh Sangyoung, a researcher at Mirae Asset Securities, commented, "Last week, the U.S. market saw a significant rally among major tech stocks driven by hopes for an end to hostilities and options-related flows, but today, profit-taking led to a mixed close."

Unlike the U.S. markets, the Korean market showed distinct strength. On this day, foreign investors turned net buyers for the first time in three sessions, leading strong advances in semiconductor and secondary battery sectors, including SK hynix, Samsung Electronics, and LG Energy Solution. As of 9:38 a.m., foreign investors recorded net purchases of 444.7 billion won on the KOSPI, while institutions also posted net purchases of 191.7 billion won. Individual investors, by contrast, were net sellers to the tune of 626.2 billion won.

As of 9:39 a.m., SK hynix soared 3.77% from the previous day to a record high of 1,211,000 won, and then hovered in the 1.22 million won range. SK hynix is set to announce its first-quarter earnings on April 23. The securities industry expects SK hynix's first-quarter operating profit to exceed market expectations, potentially reaching the 4 trillion won range. Samsung Electronics also traded up 2.86% at 218,500 won.

The secondary battery sector also stood out. As of 9:41 a.m., LG Energy Solution was trading at 466,000 won, up 8.62% from the previous day. Samsung SDI climbed 8.55% to 584,000 won. The previous day, Samsung SDI announced that it had signed a multi-year contract with German automaker Mercedes-Benz to supply next-generation electric vehicle batteries. Industry estimates put the contract value at over 1 trillion won.

In addition, Hyundai Motor (up 0.85%), Kia (up 0.38%), and Hyundai Mobis (up 1.31%) in the auto sector also showed strength. Meanwhile, financial stocks such as KB Financial Group (down 0.19%) and Shinhan Financial Group (down 0.10%), as well as Samsung Biologics (down 0.44%), Hanwha Ocean (down 0.08%), and Hyundai Rotem (down 0.92%), were slightly lower. Han Ji Young, a researcher at Kiwoom Securities, said, "Despite increased wait-and-see sentiment regarding U.S.-Iran negotiations and the impact of weakness in the U.S. market, the KOSPI is experiencing sector rotation driven by expectations for the first-quarter earnings season."

KOSPI Projected to Surpass 7,000 and Reach 8,000 Points

The securities industry expects the KOSPI to continue hitting new highs, supported by improved earnings at major companies such as those in the semiconductor sector, which is also setting new records in exports. According to the Korea Customs Service, semiconductor exports from April 1 to 20 (preliminary customs clearance basis) reached USD 18.3 billion, up 182.5% from the same period last year—the highest ever for this period in April.

Some forecasts suggest that the KOSPI could rise to 8,000 points within a year. Global investment bank Goldman Sachs raised its 12-month KOSPI target from 7,000 to 8,000 in a report released the previous day. Timothy Moe, Chief Asia-Pacific Equity Strategist at Goldman Sachs, revised the projected KOSPI earnings growth rate for this year from 130% to 220%, raising the upper bound for the index to 8,000.

The report forecasts that the fundamentals of Korea’s semiconductor and industrial sectors will continue to improve throughout this year. In particular, it views demand for artificial intelligence (AI)-related semiconductors as the key driver of earnings growth. Excluding Samsung Electronics and SK hynix, the market's overall profit growth rate is also projected to reach 48%. Furthermore, despite these improvements in earnings, the KOSPI's 12-month forward price-earnings ratio (PER) remains at about 7.5 times, significantly lower than the historical peak average of 10 times.

Previously, Nomura Securities also projected that the KOSPI could reach 8,000 points, supported by semiconductor profits. Among domestic brokerages, Hana Securities (target 7,870), KB Securities (7,500), and Hyundai Motor Securities (7,500) have all forecasted a continued bull market for the KOSPI. Kim Dongwon, Head of Research at KB Securities, emphasized, "The momentum in semiconductor earnings will trigger a re-rating across the Korean stock market," adding, "Government measures to vitalize the capital market, such as amendments to the Commercial Act and improvements in corporate governance, will also have a positive impact."

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