Kosdaq Surges on Alteogen as Rally Begins; Individual Investors Urged to Beware Overheating

News of Alteogen's third licensing-out deal and a Daishin Securities report analyzing the surge in Keytruda sales served as the main positive catalysts.

Buoyed by this news, the Kosdaq healthcare sector showed strength, and Alteogen's trading value jumped to 460 billion won, leading the overall Kosdaq market higher.

This signals that after the July downturn, a rally led by small and mid-cap stocks has taken hold from August onward.

Against this backdrop, the Kosdaq index has posted a strong gain overall.

On August 4, the Kosdaq broke above its 20-day moving average, a positive signal. The KOSPI, by contrast, has yet to break through that level and continues to lag the market.

This suggests that even as the broader market falls, sectors such as robotics and healthcare have begun to rebound and are turning the market's direction. Overall, Kosdaq is holding up stronger than the KOSPI.

This shift has created a sense in the market that the factors pushing rates higher have diminished.

As a result, small and mid-cap growth stocks are showing strong moves in today's trading.

The secondary battery sector has shown a turnaround trend recently. It has moved somewhat more slowly than healthcare and robotics, but it has settled above the 20-day moving average and outperformed the market. Optical communication and glass substrate stocks, such as Taesung, have shown even stronger moves.

These sectors have recorded clear gains despite broad market weakness, drawing investor interest.

This appears to be a supply-and-demand fluctuation following a period of sharp gains and declines.

For now, the fundamentals and underlying value of these companies appear unchanged.

Michael Burry continues to emphasize his short positions in semiconductors, arguing that the AI trade is a bubble. However, data centers are still earning good returns, and Sandisk has said it cannot sell products fully because of supply shortages.

This suggests semiconductor demand remains very solid, and if anything, supply is failing to keep up with demand.

Semiconductor stocks have not yet shifted into a bullish short-term moving average alignment. Once the moving averages begin turning into bullish alignment, they are expected to regain direction and momentum.

For now, stocks that have already been sold heavily, where sellers have exited and holders are not placing sell orders at current prices, the so-called 'empty house' stocks, may offer an alternative from a return-seeking standpoint.

When a single stock in a particular theme rises sharply, other companies in similar businesses tend to move with it and form a theme group. In this Kosdaq rally, Alteogen has begun moving as the flag-bearer.

Adding to this, the secondary battery sector has also shown good momentum, and the two pillars of the Kosdaq market are continuing to trend positively overall.

The Kosdaq index recently rose about 6%, and the Kosdaq 150 index gained nearly 8%. This means large-cap stocks within the Kosdaq market are rising especially strongly.

The rise, led by large caps, is lifting the Kosdaq index as a whole.

The market is in a strong uptrend, though it is closing with an intraday pullback. Individual investors, however, should be careful not to be swept up in the euphoric talk of 'going to 1,000, going to 3,000' and jump in rashly after a big rise.

Investment based on excessive optimism can be risky.

Weakness in financial stocks and easing concerns about rate hikes are the main drivers of the rally.

When targeting small and mid-cap stocks, buying on dips during pullbacks is a sound strategy. With the 5-day moving average above the 20-day and the short-term averages moving toward bullish alignment, buying stocks on pullbacks within the uptrend should be effective.

The secondary battery sector and semiconductor supply-chain stocks have fallen considerably and are now in attractive positions.

Lighter stocks with good price momentum are preferable to large-cap stocks. Since prices have fallen sharply and are now turning, considering buying on dips during pullbacks may be a good entry point.

Alteogen pushed its share price up to a resistance level last Friday. Even after a gap opened on the ex-rights date and a bearish candle appeared, the stock did not drift lower and recovered the ground it had lost. This points to a continued upward trend.

It is steadily extending its gains while absorbing short-term profit-taking.

This price level is where the stock peaked in November 2024, and it was followed by a large price gap. Therefore, a firm settlement above 350,000 won would be an important point indicating that the strong resistance has been cleared.

A pullback could still come, but getting past this zone looks central to sustaining the uptrend.

Alteogen's earnings outlook is very positive. The forecast for this year is 250 billion won, and next year's projection is nearly double at 450 billion won. Guidance is set for growth of roughly 200 billion won per year.

This shows that views once doubtful about its earnings are now turning into conviction.

Most range from 480,000 won up to 580,000 won, and Hana Securities in particular has set a target of 580,000 won.

Considering that there was an earlier downward revision, the recent upward revisions appear to reflect the positive earnings outlook and market expectations.

With Alteogen now entering a strong resistance zone, considering new purchases at this point should be approached with caution.

Investor sentiment is extremely important in the biotech sector. Many loss-making companies cannot be valued on PBR, and investment often rests on expectations for their pipelines. Alteogen's surge is having a positive effect on sentiment across the biotech sector.

Alteogen's successful move is expected to warm other biotech companies as well. It could be the signal for a re-rating and expanded investment across the entire biotech sector.

Watching the moves of such large stocks closely is therefore important.

In a sense, this resembles a 'game of nerves' among investors, and it plays a central role in reading the market's direction.