Market Trends After FOMC Uncertainty Resolution

Contrary to the theory that small and medium-sized stocks generally weaken during interest rate hikes, the KOSDAQ market has recently maintained relative strength. This reflects the unique characteristics of supply and demand within the market, where small amounts of capital have flowed into specific stocks without large-scale capital inflows. This discrepancy highlights the difference between theory and the actual market.

As a result, FOMC-related uncertainty is considered resolved. However, the market simultaneously showed a lull, lacking both further upward and downward momentum. This suggests that the expected outcome did not significantly move the market.

Kim Jang-yeol, expert, commented, "There was nothing very new because the interest rate hike was at the expected level, and the upper range of the dot plot also did not deviate from expectations." This analysis explains why the market showed a neutral reaction. Investors are waiting for the next momentum without major changes.

Major issues that could move the market after the FOMC have already been absorbed. The next key momentum is expected to be individual issues and the third-quarter earnings announcement season. Kim Jang-yeol, expert, stated, "The next momentum needs to go to individual momentum, and then later it needs to go to the third-quarter earnings momentum." He predicted that the earnings momentum will drive market trends from late September through October. Therefore, the movement of individual stocks becomes more important than the overall index during this period.

The current stock market is suffering from a general liquidity shortage due to a sharp drop in trading volume. Lee Kwon-hee, expert, analyzed the current situation, saying, "It's because there's no money, liquidity is low, so small amounts of money are moving around. There's no big money." The lack of liquidity limits the inflow of large funds, instead causing a short-term yield game centered on small-cap stocks. This shortage of supply and demand intensifies the short-term nature of market trends.

Kim Jang-yeol, expert, said, "I talked to industry insiders yesterday, and it seems almost certain," analyzing that President Lee Seok-hee's recruitment effect and visit to Korea likely influenced the cooperation discussions. It was mentioned that the cooperation is more likely to be related to HBM (High Bandwidth Memory) rather than memory production cooperation as reported by the media. HBM is an essential technology for high-performance AI semiconductors, and cooperation between the two companies is expected to create synergy in this field.

Kim Jang-yeol, expert, anticipated the timing, stating, "Anyway, since it's not a completed factory yet, we should probably look at 2028 or even 2029." The main significance of this cooperation is the ability to expand HBM production through base die manufacturing. If base die production proceeds smoothly, it would be possible to rapidly increase the total number of HBMs while reducing the number of HBM stacks, thus effectively meeting the HBM demand of major customers such as NVIDIA and Google.

Kim Jang-yeol, expert, explained, "They raised the economic growth rate. Interest rates are going up, but they are contained. So, because the economy is good, they need to prevent inflation from expanding due to oil prices by raising interest rates." This implies that the driving force for economic growth in a high-interest rate environment is found in AI. It is interpreted that the demand for AI-related investment will offset the increased cost of capital due due to interest rate hikes and drive overall economic growth.

As interest in the Starship's orbital test flight, scheduled for September 22, intensified, capital flowed into related stocks. Kim Jang-yeol, expert, commented, "The aerospace theme suddenly reflected the news that SpaceX would conduct a test launch, which was an event we already knew about." Institutional buying was observed in key stocks like HVM, driving the theme's strength.

Kim Jang-yeol, expert, explained, "If you look at recent reports on Satrec Initiative, it talks about benefiting from increased demand for defense reconnaissance satellites," stating that key stocks like Satrec Initiative have confirmed technical support levels. With share prices having given back all gains from December last year to early this year, a support line has formed, making short-term approaches effective. However, short-term response strategies, such as adhering to stop-loss limits, are emphasized.

This is expected to have a positive impact on Daeduck Electronics' stable volume securing and mid-to-long-term growth.

This strategy focuses on following major market trends in a 'less gain, less loss' manner.

In the shipbuilding sector, HD Hyundai Heavy Industries is considered the preferred leading stock by analysts. Lee Kwon-hee, expert, explained, "Shipbuilding analysts... So, we should approach it by considering it as the leading stock." However, he emphasized that to maximize returns, attention should be paid to engine-related material stocks. In particular, Hanwha Engine is highly attractive for investment, maintaining an upward trend from its low point with anticipation of strong earnings. While focusing on leading stocks, a strategy of considering related material stocks is necessary for higher returns.

As AI systems become more sophisticated, the consensus is growing that CPO technology commercialization is essential to handle the explosively increasing data processing volumes.

Foreign investors' futures and options supply and demand show conflicting patterns, making it difficult to predict market direction. Lee Kwon-hee, expert, analyzed, "Overall in futures and options, foreigners are betting on a downward direction. But if you only look at options, they are looking at an upward direction." While betting on a downward trend in the futures market, they appear to be looking upward in the options market by purchasing call options to pursue structural profits. Considering the call option purchase positions, the 2,700 point is considered a major turning point for the market. This suggests that foreigners are preparing for a short-term decline while also leaving open the possibility of a mid-to-long-term rise.

An analysis indicates that Korean semiconductor stocks have lower priority in global AI-related investments. Kim Jang-yeol, expert, stated, "It has been quite some time, unfortunately, that SK Hynix and Samsung Electronics stocks in Korea are not a priority, hasn't it?" U.S. big tech companies are leading AI investments, and related stocks are being selected first. In the memory sector, there is a phenomenon where SK Hynix's American Depositary Receipts (ADRs) command a higher premium than its Korean underlying shares. This is due to a global supply-demand imbalance, resulting in approximately a 40% discount on the underlying shares.

This is an attempt to address concerns about power shortages due to the rapid growth of the AI industry through technical efficiency, and it is expected to contribute to the sustainable development of the AI industry in the long term.