Goldman Sachs said in its latest Korea market weekly that South Korean equities remain under pressure even as foreign investors have recently bought into the KOSPI and Alphabet’s higher AI capital expenditure outlook has reinforced the semiconductor demand narrative. The KOSPI still fell about 2% last week, according to the report.
The bank said foreign inflows were concentrated mainly in technology shares, while the broader Korean market continues to face medium-term outflow pressure. Foreign ownership in the semiconductor sector is near historical lows, it added. Goldman also noted that the KOSPI’s 12-month forward EPS estimate was revised down by 0.4%, with the auto sector facing the heaviest earnings adjustment pressure.
On leverage, retail margin balances in Korea declined to $22 billion from a peak of $25 billion, while leveraged ETF assets fell to $26 billion from $53 billion. Goldman said AI capex remains the main support factor for Korean equities, but lower earnings expectations, light foreign positioning and swings in risk appetite could continue to amplify short-term index volatility.
Goldman Sachs said in its latest Korea market weekly that the KOSPI fell about 2% last week even as foreign investors had been buying the index and Alphabet raised its AI capital expenditure outlook, a move that strengthened the semiconductor demand narrative.
Foreign buying focused on technology
The bank said the recent return of foreign capital was concentrated mainly in technology stocks. Still, the Korean market continues to face medium-term outflow pressure, and foreign holdings in semiconductor names are close to historical lows.
Earnings expectations moved lower
Goldman also said the KOSPI’s 12-month forward EPS estimate was cut by 0.4%. Among sectors, automakers are facing the greatest pressure from earnings estimate revisions.
Leverage has pulled back from peak levels
On positioning and leverage, retail margin balances in Korea fell to $22 billion from a peak of $25 billion. Assets in leveraged ETFs dropped to $26 billion from $53 billion.
Goldman said AI capital spending remains the main support factor for Korean equities. At the same time, lower earnings expectations, low foreign positioning and shifts in risk appetite could keep amplifying short-term moves in the index.
This article was originally published by Bit.Fan. For more cryptocurrency news and market insights, visit www.bit.fan. Disclaimer:
The market information, project data, and third-party content displayed on this platform are for industry information sharing only and do not constitute any form of investment advice or return commitment.
Cryptocurrency trading carries high risks. Users should fully assess their risk tolerance and make independent decisions. All profits, losses, and legal responsibilities are borne by the users themselves.
