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| A dealer at Hana Bank works at its dealing room in Seoul, Tuesday. Yonhap |
By Lee Min-hyung
Korea's financial markets have grown increasingly less sensitive to prolonged inflation woes in the United States, as major large-cap companies in semiconductors and automobiles are forecast to gradually enhance their earnings fundamentals through recovering exports, analysts said.
The analysis contrasts with the volatile market sentiment prevalent last year when local stocks and currency extended wide losses in reaction to the U.S. Fed's steep rate hikes and then-soaring prices.
But starting this year, major indices here have not displayed any turbulent ups and downs on hopes of an end to the global cycle of monetary tightening. Market participants also seem to have adapted to the prolonged inflation woes, as was shown by the recent recovery momentum in the local stock market.
The benchmark KOSPI closed down 1.53 percent at 2,427.9 points, Wednesday, hit by disappointing inflation figures in the world's largest economy. The won-dollar exchange rate rose by 12.8 won, and closed at 1,282.2 won per dollar.
But market analysts still remained optimistic over the rebound of the local stock market from a mid-term viewpoint, as monetary risk factors here and abroad will be gradually alleviated by the end of 2023.
"The KOSPI will be leveled up as the year-end approaches, as global monetary authorities are forecast to introduce pump-priming measures in the latter half of this year, and the once-prevalent monetary uncertainty will be eased," Kim Dae-joon, an analyst at the Korea Investment & Securities, said.
The brokerage house also revised up the KOSPI's upper limit to 2,800 points this year from an earlier forecast of 2,650 in the hopes of the alleviation of the external monetary risk factors.
The analyst also expected major semiconductor and automobile stocks to boost the main bourse's rally.
"Stocks in the area of chips and cars will bounce back on export growth and subsequent earnings recovery," he said.
Meanwhile, some analysts say investors should be wary of the short-term adjustment of the local stock market.
"There still stands a possibility that Korean stocks recover their recent gains if the Fed sends any further gestures of maintaining the rate hike level without cutting it this year," Kiwoom Securities analyst Han Ji-young said.
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