Foreign Selling Continues, Rotation Spreads Beyond Semiconductors… What's the Market Direction for September?

Reports recently emerged about an agreement between Iran and Oman regarding the Strait of Hormuz. This news is spreading through Russian and Iranian local media, but the details tend to change frequently, so careful verification of its veracity is required. In the past, many foreign reports related to Iran have proven unreliable, so investors are advised to exercise caution.

If the report is confirmed to be true, it could significantly impact international oil prices and geopolitical risks, thus requiring close monitoring of related trends. This is especially true given the high impact of such news on the market during times of increased international uncertainty.

CEO Ha Bono began by mentioning the news, stating, “Reports are now coming out about this Iran-Oman agreement related to the Strait of Hormuz.”

Recently, war risks have significantly eased, and the US 10-year Treasury yield has fallen to 4.62%, indicating a positive shift in the macro environment. Considering that foreign capital outflows previously occurred due to external macro influences, these improvements suggest a potential rollback of foreign supply and demand.

CEO Ha Bono expressed this expectation, saying, “As war risks have significantly eased, the 10-year Treasury yield has also dropped to 4.62%. If both of these have improved, and assuming foreign outflows were due to external macro factors, then we should see that capital flow back in.”

Today, Samsung Electronics and Hynix announced plans to buy back 2 million shares and 650,000 shares, respectively. These large-scale share buybacks are expected to act as a positive signal to the market, supporting stock prices and improving investor sentiment.

Recently, expectations for NVIDIA's expanding robot business have grown, drawing market attention to robot-related stocks. The surge in substrate-related stock Socam and reports on Simmtech and TLB can be interpreted as areas of interest for NVIDIA. This trend is leading to a simultaneous strength in data center-related stocks.

However, some stocks, like Jeonjin Construction Robot, are classified as reconstruction theme stocks rather than robot stocks, requiring caution during investment. In situations where themes are mixed, it is necessary to thoroughly analyze the company's core business and its relevance.

CEO Ha Chang-wan stated that while Hyundai E&C should consider both reconstruction and nuclear power themes, he currently places more weight on the upside potential of the nuclear power sector. This is interpreted as a high evaluation of the nuclear power industry's structural growth potential due to policy support and global energy transition trends.

CEO Ha Chang-wan expressed his positive view on the nuclear power theme, saying, “But I am putting a bit more weight on nuclear power.”

An analysis suggests that Samsung Electro-Mechanics' recent stock underperformance is more influenced by program net selling than by the MLCC (Multi-Layer Ceramic Capacitor) industry itself. Samsung Electro-Mechanics frequently appears among the top stocks with program net selling, and the volume is not insignificant, limiting stock price increases.

CEO Ha Chang-wan emphasized the importance of supply and demand factors, stating, “Samsung Electro-Mechanics has been very frequently at the top of program net selling recently. And the volume itself is not small.”

The main reasons for the recent inflow of capital into bio stocks are issues surrounding US biotech companies, led by Moderna, and falling Treasury yields. When Treasury yields decrease, liquidity tends to expand into the bio sector, and positive news for KOSDAQ leading stocks like Alteogen also has a positive impact.

CEO Ha Chang-wan explained, “US biotech companies, led by Moderna, are generating a lot of activity… Treasury yields have decreased. When Treasury yields fall, capital tends to flow into the bio sector,” emphasizing the investment appeal of the bio sector.

The stable upward trend of financial stocks no longer aligns with the dopamine dependence of investors who prefer rapid gains in the current market, leading to a decrease in their attractiveness. CEO Ha Chang-wan pointed out that a rise of around 2% is often not considered a 'rise' by the market.

CEO Ha Chang-wan explained this investment sentiment, saying, “People nowadays don't even consider a 2% rise as a rise. Yes. They are quite addicted to dopamine.”

Recently, foreign capital amounting to approximately 9 trillion won flowed in, but about 4 trillion won was sold again, leaving only about 1.4 trillion won. If this foreign selling continues despite improvements in external variables, it could slow down the pace of index growth.

In particular, the buying and selling patterns of foreign investors significantly impact short-term market trends, so future supply and demand trends must be closely monitored. If foreign selling occurs during attempts to break through important index resistance levels, the upward momentum could weaken.

CEO Ha Chang-wan explained the current situation, saying, “Foreigners recently had almost 9 trillion won come in, but then 4 trillion left yesterday, so there's only about 1.4 trillion won left.”

Currently, the market is seeing rotation spread to various industries beyond the semiconductor sector. The strength of MLCC (Multi-Layer Ceramic Capacitors) and the expansion of optical communication related stocks (Kwangjin, B&C Electronics) are prominent, with active capital movement also seen in reconstruction and power infrastructure related themes.

CEO Ha Chang-wan mentioned this rotation phenomenon, saying, “It seems like various industrial groups are moving additionally now.”

When theme-based stocks show strength in the current market, top market capitalization stocks tend to take a relative break. This is because insufficient overall market trading volume causes capital to flow into theme stocks, slowing the upward momentum of large-cap stocks.

However, share buybacks by Samsung Electronics and Hynix can support these large-cap stocks, helping to prevent a sharp market decline.

As semiconductors account for over 40% of domestic import and export data, the health of the semiconductor industry is a key factor determining the overall strength of the stock market. CEO Ha Chang-wan emphasized that if semiconductors collapse, the stock market's strength will inevitably decline, asserting the need for market attention to focus on semiconductors.

Therefore, an analysis suggests that rotation through concentrated profits can actually help maintain a healthy market flow. It is desirable to pursue rotation based on the stability of core industries rather than excessive concentration on specific sectors.

For APR's stock trend, breaking through the previous high is the key. If it breaks this high, significant additional upside potential opens up, but if it fails, there is downside potential to the early 420,000 won range.

However, the analysis suggests that the trend remains positive. Even if short-term technical adjustments occur, it is important to remember that the uptrend is valid from a medium-to-long-term perspective.

CEO Ha Chang-wan explained the importance of technical analysis, saying, “If it breaks through this time, the upside opens up, and if it doesn't, it slides down again, something like that.”

Considering the large volume of options outstanding, the semiconductor sector is likely to show a relatively stable trend for the next two weeks. For short-term targets, excluding data center-related issues, the market could reach 7,300 to 7,500.

However, if data center-related issues are resolved, even higher levels can be expected. Nevertheless, expecting a sharp rise within a month is delusional, and a long-term approach to the market is advised. It is important to approach the market from a medium-to-long-term perspective rather than being swayed by short-term fluctuations.

CEO Ha Chang-wan explained, “Given the large number of options outstanding, the semiconductor sector is likely to be relatively comfortable for the next two weeks. Excluding data centers, we can look at 7,300 to 7,500 for short-term upside, but if data center issues are resolved, you can expect even higher.”

In the KOSPI market, reconstruction stocks continue to show strength, with some rotation occurring in bio, energy, and substrate-related stocks. The substrate sector, in particular, tends to move in conjunction with NVIDIA's areas of interest. This rotation can be interpreted as a healthy sign of market liquidity being distributed rather than concentrated in specific sectors.

In the KOSDAQ market, LNG project-related stocks, especially Sungkwang Bend and Taekwang, surged and showed strength. This is interpreted as reflecting expectations for energy transition and expanded infrastructure investment. As the leading themes differ across markets, investors need to pay close attention to these trends.

The semiconductor material, parts, and equipment (SooBujang) index was presented as an important criterion for judging the strength of the semiconductor sector. The performance and order trends of SooBujang companies provide important clues for predicting the overall trend of the semiconductor industry.

CEO Ha Chang-wan summarized recent market trends, saying, “On the KOSPI, reconstruction stocks are still strong, and there's some rotation in bio, energy, and the substrate sector, as I mentioned. On the KOSDAQ, LNG projects have also strengthened.”

Key events that will determine the market's direction are scheduled for the coming September. On September 9, bond buyback trends are expected to influence the market, and importantly, the Stable Coin Clarity Act is scheduled for announcement on September 15, drawing attention.

CEO Ha Chang-wan suggested that this bill could be a significant turning point for the market, stating, “Considering the short-term situation and the Stable Coin Clarity Act coming out on September 15, I think the market will likely firm up its direction then.” Such important policy decisions are expected to significantly impact overall market sentiment and liquidity.