September 4 Morning Market Overview and Strategy

The KOSDAQ and KOSPI indices are closely watched as they approach their 60-day moving averages, a critical technical indicator. The market is currently being driven by strong performances in biotechnology, secondary batteries, and especially robotics. Semiconductor materials, parts, and equipment (so-bu-jang) stocks are also showing overall gains. The KOSDAQ's recovery past 800 and aiming for 815-820 would signify re-entry into a positive price range.

A cautious approach is advised for over-weighting Samsung Electronics and SK Hynix. During market rebounds, these two leading stocks are anticipated to have weaker upward momentum compared to other sectors. Investors might consider reducing their exposure to these stocks if their portfolio concentration is too high, and reallocating funds to other, potentially faster-growing sectors.

Goldman Sachs released a report on Robotis, setting a target price of 630,000 KRW. The report highlights the increasing demand for 'Physical AI' and the role of actuator technology in micro-robots, specifically mentioning their application in products like "micro-duck" and "Richy Mini." This foreign institutional report has provided significant positive sentiment for Robotis.

April Bio's stock price previously suffered due to negative results from a project with Lundbeck, specifically regarding its new drug candidate, Kuvogilizumab. However, recent news suggests a potential revival of the Lundbeck project, alongside positive pre-clinical results for a new 2-target RNAi inhibitor, which showed an inhibitory trend. Despite these positive developments, investors are urged to remain cautious due to past governance issues and lingering market uncertainty.

Trading in the semiconductor material, parts, and equipment (so-bu-jang) sector has become increasingly challenging. The sector has lost its historical 'herd behavior,' where all stocks would move in unison. Now, individual stocks often show uncorrelated movements, with some rising while others fall, or vice-versa. This lack of collective direction makes stock selection and timely responses significantly more difficult than in the past.

The Goldman Sachs report on Robotis has significantly strengthened the positive sentiment around the company. This meaningful report provides a compelling reason to maintain a favorable view on Robotis. The speaker continues to hold a positive outlook for the stock's performance in the foreseeable future, suggesting it is a worthwhile investment.

The market remains in a fragile state, heavily influenced by the upcoming US labor market data scheduled for release tonight. This report is a critical factor for market volatility, which is expected to increase significantly, particularly in the afternoon. Investors are advised to exercise strategic caution and avoid aggressive buying at the morning's peak, as market reactions to the data could be sharp.

For investors whose cash levels have risen above 50% due to recent stop-losses, this is an opportune time to gradually increase stock allocation. The target stock exposure is set between 50% and 70%, emphasizing a measured approach rather than full market exposure. Given the ongoing market volatility, disciplined position management remains crucial to navigate potential shifts.

The robotics sector is currently spearheading market momentum, demonstrating significant strength without notable pullbacks. This strong upward movement is particularly visible in the KOSDAQ market. The previous market hesitation has largely dissipated, with the sustained performance of robotics indicating a more stable market environment, especially if biotechnology sectors, which have recently seen declines, also stabilize.

For investors who find Robotis's current valuation too burdensome, SPG is suggested as a viable alternative within the robot sector. SPG's appeal is enhanced as it crosses its 60-day moving average, serving as a technical entry signal. This provides an option for investors seeking exposure to the robotics industry without the perceived high cost of Robotis.

Any potential market rebound and stabilization are fundamentally linked to a decline in treasury yields. The resolution of broader macroeconomic issues is identified as the primary catalyst for sustained growth. In this recovery scenario, the KOSDAQ market is preferred over KOSPI for its growth potential. Investors should closely monitor these macroeconomic indicators for signs of market turnaround.

Investors with significant holdings in Samsung Electronics and SK Hynix, especially those holding 100-200% of their portfolio, are advised to gradually reduce their positions. The strategy involves rotating these funds into other high-growth sectors. The focus should be on market standards and observed foreign capital inflows, as these are key indicators for optimal portfolio adjustment.

For long-term holdings, such as Korean Air, with an entry price of 19,500 KRW, holding is strongly advised, especially after securing a 50% profit. The recommendation is to maintain this profitable position or implement a trailing stop to protect gains. Emphasizing the broader market trend over individual stock charts is crucial for informed decision-making.

The current rally in robotics stocks, including Robotis, is primarily a reflection of broader market sentiment rather than specific corporate news or intrinsic value. The rapid growth seen in Robotis is largely attributable to the overall positive market atmosphere and the prevailing trend within the robotics sector. Therefore, market timing remains a crucial factor for current trading strategies, rather than focusing solely on individual company fundamentals.

Investors are encouraged to monitor stocks in the aerospace sector, specifically mentioning Spier and HVM. October is highlighted as a significant month for the Korean aerospace industry due to anticipated milestone events. Additionally, the positive trends observed in global aerospace companies, such as SpaceX in the US, contribute to the strategic focus on this sector, suggesting potential for growth.

A significant regulatory update from the Financial Services Commission will allow tokenized assets, extending beyond fragmented investments to include stocks, bonds, and funds. This development is expected to positively impact growth sectors, particularly those involved in fragmented investment platforms and financial technology. Recommended stocks for consideration in this evolving landscape include Facto Financial, NHN KCP, and Kuchen, which are positioned to benefit from these regulatory changes.

It is advised to maintain stock holdings within a range of 50% to 70% of the total portfolio. In the current market conditions, investors should reduce their exposure to margin trading to mitigate risks. Furthermore, adopting flexible exit strategies, including both stop-loss and take-profit orders, is recommended for managing existing positions effectively. This balanced approach aims to optimize returns while controlling risk.

Samsung Electronics and SK Hynix are evolving towards 'value stock' characteristics, with their future performance contingent on consistent shareholder return policies over the next five years. A healthy market environment would see these stocks demonstrating reduced volatility, moving within a narrow 3% range, both upward and downward, while still showing an overall upward trend. This concentration in major semiconductor stocks can be utilized as an opportunity for portfolio diversification, rotating funds into other promising sectors.

Market sentiment is heavily influenced by upcoming US labor market data, with a preference for 'weaker' numbers. The logic of 'bad news is good news' applies here, as softer employment data could alleviate concerns about aggressive interest rate hikes by central banks. Conversely, strong employment data might fuel fears of continued tightening monetary policy, potentially leading to market instability.

Psychological control is paramount in stock trading, which is likened to legalized gambling. Investors are warned against 'revenge trading,' which involves attempting to recover losses with insufficient capital, often leading to further losses. The ability to manage emotions, including knowing when to 'fold' or retreat, even when holding what appears to be a strong position, is emphasized as a critical skill for long-term success.

The market outlook has shifted from cautious to more optimistic, signaling a favorable environment for increasing stock allocation. While complete portfolio saturation is deemed overly ambitious, the current conditions suggest actively seeking buying opportunities to gradually build positions in identified sectors. Despite the potential for continued market volatility, the overall sentiment remains positive, encouraging strategic accumulation.

Hyundai Motor's stock is currently perceived as fundamentally weak, and an immediate entry is not recommended. An ideal entry point is suggested to be in the 390,000 to 400,000 KRW range, where the stock would show more strength. Investors are advised against purchasing at current price levels, emphasizing patience until more favorable conditions emerge.

A pyramiding strategy for averaging down involves a step-by-step entry approach: initially buying 40% of the intended position, then adding 30% more at a lower price point (e.g., 9,700 or 9,600 KRW), and finally the remaining 30%. This method aims to achieve an average purchase price, for example, around 9,600-9,700 KRW. A strict stop-loss is set at a 5-7% total loss to manage risk effectively.