Growing Technical Market

 

Stock investors are focusing more on the KOSDAQ since the index broke the 600 point mark for the first time in six years and eight months. 

The securities analyst consensus is that the upturn as of late is meaningful enough because it is supported by small firms’ growth potential and performance. Under the circumstances, the growth of the Korean stock market is likely to be led by the KOSDAQ and small caps, rather than blue chips, this year. 

“Although the number of less successful companies was larger in the KOSDAQ, today’s upward trend is being led by those sounder ones having higher market caps,” said Kang Tae-shin at KB Investment & Securities, adding, “This means that the bourse is on the right track now to continue to show unprecedentedly favorable conditions.”

“Pessimistic views are rare in the KOSDAQ nowadays, even though the fluctuation of the index depended heavily on news and rumors,” Kim Kap-ho at Kyobo Securities commented, continuing, “Even mobile game stocks that gained much last year are expected to be supported by their performances, despite some concerns.”

Kim Hee-sung at Hanwha Investment & Securities echoed the sentiment by saying, “The popularity of small caps is partly because of the less-than-expected Q1 performances of the large caps, and the IT component manufacturers, which account for a significant portion of the bourse, are forecast to show good performances this year.” IBK Investment & Securities analyst Yoo Wook-jae was more prudent to say, “Although the market is likely to keep showing an upturn with the trough going up since 2011, we seem to need to wait and see until the small caps’ performances are disclosed at the end of the first quarter.”

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