[다음주 증시전망]Cold and hot bath Ogan KOSPI…

Kospi shakes during’interest rate seizure’ this week

“Can monetary policy be maintained?” growing doubts

1.7% interest rate possible…may lead to volatility

Only two interests in earnings improvement stocks in preparation for’performance market’

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Expectations for an economic recovery and concerns about rising interest rates alternately hit the market, causing extreme volatility in the KOSPI index. On the 26th of this month, as the 10-year US Treasury bond yield exceeded 1.5%, which was considered the psychological resistance line, the KOSPI returned most of the previous day’s gains (3.50%) and managed to keep the 3,000 line. As the preference for risky assets declines, the securities industry believes that volatility may increase for the time being. KOSPI predicted the band for the next week at 3,020 to 3,160 for Korea Investment & Securities and 2,950 to 3,150 for NH Investments and Securities.

According to the Korea Exchange on the 27th, the KOSPI index on the previous day ended at 3,012.95, a plunge by 2.80% (86.74 points) compared to the previous trading day. The Kospi, which once started plunging on the news that the interest rate of US 10-year Treasury bonds soared to 1.61%, has been pushed to the threshold of 3,000 units as foreigners and institutional investors robbed a large amount of sales.

Investors are not easily convinced of stocks due to fears that the liquidity environment, which has contributed greatly to the KOSPI’s rise over the past year, may be broken. Kim Hak-gyun, head of Shinyoung Securities Research Center, said, “As the economy recovers due to the vaccine effect and the market is normalizing as prices rise, there are doubts about whether to continue last year’s monetary policy. It appears through the appearance of an interest rate hike.”

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For the time being, the outlook is predominantly that the stock market will be affected by fluctuations in market interest rates and may show a sideways movement or adjustment. Fed chairman Jerome Powell is reassuring the market that austerity will be possible after three years, but experts predict that interest rates could go up to 1.7%. As interest rates on the market exceed 1.5%, the average dividend yield of US companies, the attractiveness of bonds is also putting a burden on stocks. Dae-hoon Han, a researcher at SK Securities, said, “As interest rates have caused a decline in investment sentiment, we need to pay attention to the direction of US interest rates for the time being.” “Expanding volatility in the stock market (due to rising interest rates) seems inevitable.”

Nevertheless, it is only a brief breath, and the analysis is that the mid- to long-term trend is still valid. It is explained that the rise in interest rates is basically due to expectations for an economic recovery, and earnings improvement momentum can warm the atmosphere of the stock market as the economic uptrend begins in earnest. Kim Ji-san, head of the Research Center at Kiwoom Securities, said, “We expect the market to stabilize as the economic recovery momentum is emphasized in the second quarter.” Said.

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Some advise that the market should be prepared for a’performance market,’ where the link between stock prices and earnings increases as the market’s vitality declines. According to F&Guide, this year’s operating profit consensus for Samsung Life Insurance, LG Display, HMM, Kumho Petroleum, Kiwoom Securities, Kia Motors, and SK Hynix has been revised significantly this year. Furthermore, it is analyzed that a hint of whether the consensus trend will rise in the future can be obtained through the protrusion of earnings estimates that significantly exceed the market average. This is because the value with a large gap between the consensus serves as a new reference point and raises the forecast that follows.

Next week, a two-way meeting in China is scheduled. Economic stimulus measures worth 25 trillion yuan (4,300 trillion won) are expected to pass, but there is no accurate guideline, so the possibility of disappointing sales withdrawal cannot be ruled out. One researcher said, “Ahead of the two meetings, China’s investment expectations were high every year, and this year we are drawing more attention with reflation.” It is prohibited”.

/ Reporter Lee Seung-bae [email protected]

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