Ahead of U.S.-China talks, 'Samsung-Hynix' draws attention

Such external political risks could strengthen foreign investors' selling, so investors are advised to stay cautious.

West Texas Intermediate (WTI) crude is trading above $90 a barrel, and the won-dollar exchange rate has sharply risen to 1,350 won. This oil price surge and currency rise are weighing on the September market and increasing downward pressure across the market.

In addition, the 60-day moving averages are concentrated in these price ranges, which could act as technical resistance and limit share price gains.

In the past, volatility indices have expanded as concentration in individual stocks intensified.

Since July 31, entry into single-stock exchange-traded funds (ETFs) has been effectively restricted, and market volatility is stabilizing. Compared with before the regulation took effect, trading value in single-stock ETFs has plunged to about one-tenth of its level, easing short-term overheating in the market.

With two possible rate hikes remaining through December, how strongly the Fed maintains its hawkish stance will be the key variable determining the market's direction.

Historically, the stock market has tended to be weak in September. However, the possibility of a Chinese-U.S. summit around September 23 to 25 is being discussed, and if the event is confirmed through working-level agreement, it could give the market a positive expectation. If the summit materializes, expectations around it could help cushion downside rigidity, potentially allowing the market to hold up amid volatility.

The market is still finding its footing, so there is no need to hastily cut positions by clinging to past data or uncertain forecasts. If considering new entry, a gradual approach—watching market trends and committing only 10% to 20%—is effective in preventing FOMO (fear of missing out).

In May and June, monthly selling reached as much as 50 to 60 trillion won, and in the bigger picture, foreign investors' selling stance appears to be strengthening.

This could slow the pace of their shift back to net buying, and is expected to appear as a speed adjustment rather than explosive selling.

Samsung Electronics and SK Hynix are carrying out share buybacks worth 1.5 trillion won, and at the current pace, they are expected to be largely completed in the third to fourth week of September. These buybacks absorb foreign selling alongside individual investors, acting as a buffer against sharp market declines.

Through preemptive coordination, the Bank of Japan governor could help stabilize the yen from 165 to below 160 per dollar, which could temporarily slow the pace at which U.S. Treasury yields rise sharply.

Looking at the currency market flow from September into October, foreign investors are likely to feel reluctant to sell aggressively. Amid possible interest rate hikes in the U.S. and Japan and dollar-strengthening pressure, foreigners may keep a wait-and-see stance or build short positions. They are also expected to pursue strategies in derivatives markets, such as buying futures in anticipation of an index surge.

Several securities firms, including Nomura, have maintained target prices for chip companies while citing the 'exchange rate' as a key clue. If the won stays about 10% stronger, as it is now, operating profit could fall by more than 10% even if semiconductor export results hit record highs, because foreign exchange losses would be unavoidable despite strong exports.

Samsung Electronics' and SK Hynix's production capacity (CAPA) is failing to keep up with surging demand, and global companies such as Broadcom have raised their 2027–2028 operating profit forecasts two- to fourfold, heightening market expectations.

Spot prices have remained about 16% above fixed transaction (wholesale) prices, reflecting market demand. This DDR5-led price increase is expected to play a key role in defending chip companies' earnings.

However, advancing one step beyond leading-edge process technology requires enormous time and investment, and China's technological catch-up still carries considerable burdens. If its share declines, opportunities may emerge in leading-edge process and packaging-related stocks rather than in major companies such as SK Hynix.

Positive chip analysts and research houses view HBM market contribution and technological gaps in leading-edge and next-generation packaging processes as the drivers of Samsung Electronics' and SK Hynix's earnings trajectories.