Despite "10,000 Points" Forecasts, Caution Advised Amid Polarization and Volatility

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Now that the KOSPI has reached the 9,000-point mark, what lies ahead?

We continue our discussion with Kim Hye-min from the Economic Affairs Desk.

Q. How much further can the KOSPI go?

[Reporter Kim Hye-min: It was only a month and a half ago that predictions of the KOSPI hitting 9,000 first emerged. While it is difficult to predict the future with certainty, the consensus among securities firms is that reaching 10,000 points within this year should be achievable. Meritz Securities has set a target of 11,500, Korea Investment & Securities projects 11,000, and global investment bank Goldman Sachs has raised its target from 9,000 to 12,000. Although interest rates remain on an upward trend and the burden of war persists, the prevailing view is that the momentum will not easily break due to strong demand for AI investment and robust semiconductor earnings.]

Q. Foreign investors are net buying for consecutive days. Why?

[Reporter Kim Hye-min: Individual investors have undoubtedly been the driving force behind the KOSPI this year, recording 73 trillion won in net purchases so far. However, foreign investors also played a significant role in the rally from 8,000 to 9,000. Since the 12th, they have been net buyers every day, with the exception of yesterday (June 17). The KOSPI has also been on a six-day winning streak since the 11th. Securities experts believe this is largely due to foreign investors returning to the domestic market after the completion of the public offering process for SpaceX in the U.S. market.]

Q. Concerns over polarization and volatility?

[Reporter Kim Hye-min: There is a sentiment I hear quite often these days: "The KOSPI is rising endlessly, so why is my portfolio in the red?" Samsung Electronics and SK Hynix account for more than half of the total market capitalization. Even today, as the index surpassed 9,000 points, only about 100 stocks saw gains, while nearly 800 stocks declined. The KOSDAQ is in a similar situation, with decliners outnumbering gainers by 5.8 times. As a small number of large-cap stocks dictate the entire index, volatility is also increasing. In particular, a massive amount of capital has flowed into leveraged products for Samsung Electronics and SK Hynix, which were listed late last month, with their combined market cap exceeding 9 trillion won. This has sparked concerns over overheating and volatility. When the KOSPI fell for consecutive days early this month, loss rates neared 40%, and price discrepancies occurred as these products failed to accurately reflect the actual value of the underlying stocks. The Financial Supervisory Service has issued a consumer alert regarding these products. Furthermore, the persistently high won-dollar exchange rate is inevitably a negative factor for the continued influx of foreign investment.]
※ Please note: This article was translated by AI and may contain errors.