AI stocks turn blue with Blue Wave…Renewable energy soars [Kim Geun-hee's Market Wrap-up]

The domestic stock market was swept up in the "Blue Wave" during the first week of November (the 2nd–6). Concerns grew that AI data center construction would be delayed due to the US Democratic Party's control of both houses of Congress, causing AI-related stocks such as semiconductors and substrates to fall across the board. Conversely, renewable energy stocks, which are expected to benefit from Democratic Party dominance, rose.

According to Korea Exchange on the 7th, KOSPI closed at 5059.69 this week, down 671.05 points (11.71%) from Jeonju (5730.74). Investor sentiment toward AI stocks deteriorated amid growing controversy over AI profitability and the US midterm elections. Concerns intensified that the US Democratic Party would strengthen regulations on AI data centers.

During this period, Samsung Electronics and SK hynix plunged 16.13% and 20.17%, respectively. Samsung C&T and SK Square, which hold stakes in the two companies, fell 12.34% and 19.29%.

Substrate stocks, semiconductor materials, components and equipment (MCE) stocks, and others ranked among the top decliners on KOSPI (market capitalization of over 1 trillion won, weekly trading volume of over 100 billion won).

The biggest decliner during this period was Daeduck Electronics, which slid 40.37%. Doosan, which produces CCL (copper-clad laminates) for substrates, also fell 28.4%. Samsung Electro-Mechanics (-27.26%) and Isu Petasys (-26.25%) saw their share prices drop by more than 20%. Hanwha Vision, which engages in security and semiconductor design businesses, also slid 25.73%.

Conversely, renewable energy stocks rose on expectations of benefiting from Democratic Party dominance. CS Wind (28.20%), OCI Holdings (19.99%), HD Hyundai Energy Solution (16.71%), and Hanwha Solutions (15.27%) ranked among the top gainers.

Researcher Han Byung-hwa of Eugene Investment & Securities said, "With the Democratic Party overwhelmingly controlling both houses of Congress, the green industry, which has been continuously squeezed by the Trump administration, will be able to breathe again."

Aside from renewable energy stocks, individual stocks with specific issues such as shareholding contests or treasury stock buybacks rose. Hanjin Kal preferred shares and Hanjin Kal rose 206.46% and 58.27%, respectively.

Hanjin Kal disclosed on the 4th that its largest shareholder had changed from Chairman Cho Won-tae and related parties to Hoban Construction and its affiliates. Based on common shares, the Hoban Group's stake is 20.69% (13,814,053 shares), which is 0.11 percentage points higher than Chairman Cho's side (20.58%).

Chairman Cho also moved to increase his stake. He disclosed on the 2nd that he had signed a contract to purchase 325,000 common shares of Hanjin Kal at 114,000 won per share. The scheduled transaction date is the 3rd of next month; if the purchase is completed without additional changes in shareholding, Chairman Cho's side will raise its common share stake to approximately 21.07%, potentially reclaiming the position of largest shareholder.

Krafton, which launched a share buyback worth 300 billion won, also rose 21.09% to rank among the top gainers. On the 3rd, Krafton disclosed that it would purchase 1,651,073 of its common shares by February 3 next year.

Financial investment industry experts forecast that KOSPI will remain volatile for the time being, as concerns over strengthened AI data center regulations due to the Blue Wave persist. In particular, AI-related stocks are expected to fluctuate significantly.

Researcher Kim Min-gyu of KB Securities said, "It is expected that a pattern of repeated sharp rises and falls will be unavoidable for the time being," adding, "Sectors showing defensive strength amid recent plunges include aviation, telecommunications, consumer stocks, utilities, biotechnology, software, and materials."