The rally in the KOSDAQ continued, driven by the upward trend in semiconductor materials, components and equipment (materials, components and equipment) stocks, combined with a rebound in biotech stocks and top market capitalization names on the KOSDAQ such as secondary battery makers. The KOSDAQ Index rose 8% in just one week, bringing it within sight of the 920th mark.
On the 6th, the KOSDAQ Index closed at 919.92, up 2.98% from the previous day. As semiconductor materials, components and equipment stocks continued their steep recent gains, leading the KOSDAQ rebound, sharp increases in large-cap secondary battery and biotech stocks were added to the momentum. Among top market capitalization stocks on the KOSDAQ that day, secondary battery shares such as Ecopro and Ecopro BM surged 7.3% and 11.2%, respectively. Analysts said this was likely due to positive investor sentiment following Tesla's third-quarter vehicle sales exceeding market expectations and news that Samsung SDI and Ecopro BM signed a memorandum of understanding (MOU) for collaborative development of all-solid-state battery materials.
Semiconductor materials, components and equipment stocks, which had maintained a steep upward trend recently, also showed strength on the day. Jusung Engineering surged 17.3%, while Wonik IPS and Iotech rose by more than 2% each. Simtech and Rino Industrial also closed higher. This is as expectations for benefits from expanded AI (artificial intelligence) investment spread to small- and mid-cap stocks, including materials, components and equipment names. Analysts noted that semiconductor materials, components and equipment have emerged as an alternative amid the sluggish recovery in share prices of major semiconductor makers such as Samsung Electronics and SK Hynix. Kim Jun-young, a researcher at iM Securities, analyzed, "Investment flows seeking beneficiaries of the semiconductor capital expenditure cycle have concentrated on materials, components and equipment stocks."
In addition, large-cap biotech stocks also showed strength amid expectations for new drug development. HLB surged 17% on expectations for a resubmission to the U.S. for approval of its liver cancer drug candidate, rivoceranib. Samchundang Pharm rose 16.7%, as expectations for technology transfer of its new drug pipeline, including oral GLP-1, gained prominence. Expectations are being reflected in the market given the high likelihood of major events such as technology transfers during the fourth quarter, when key global academic conferences and meetings are concentrated.
Recently, the KOSDAQ Index has continued to show relative strength compared to the KOSPI. The KOSDAQ Index rose 11.9% over the past month. During this period, the KOSPI Index managed only a 0.4% gain. This was influenced by major materials, components and equipment stocks rising in the 20th% to 40% range. Over this period, Jusung Engineering surged 48.8%, while Wonik IPS and Iotech rose 20.1% and 22.8%, respectively.
Given the bright outlook for major KOSDAQ large-cap stocks such as semiconductor materials, components and equipment, the rebound is expected to continue. Kim Rok-ho, a researcher at Hana Securities, predicted, "Micron expects its capital expenditure (CAPEX) in the first half of next year to be at the level of this year's investment amount, and domestic memory makers are also set to fully ramp up investments in new factories," adding, "There are many investment opportunities for materials, components and equipment companies, including front-end and back-end process firms."
On the other hand, advice is emerging that investors should make selective investments centered on earnings momentum rather than the KOSDAQ as a whole. Lee Jae-won, a researcher at Yuanta Securities, stated, "It is not yet a stage to view the entire KOSDAQ Index positively," adding, "While it is encouraging that funds are moving into semiconductor materials, components and equipment, there is insufficient basis to expect this to spread to high-valuation growth stocks such as biotech or secondary batteries, whose earnings estimates have not risen."
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