[Edaily Reporter kyoungeun kim ] As the KOSPI and KOSDAQ plunged into panic after triggering circuit breakers for two consecutive days—an unprecedented occurrence—heads of research centers at major securities firms are offering urgent analyses.
On the 29th, E-Daily compiled comments from the heads of research centers at major securities firms and found that their assessments generally agreed that this was “panic selling driven by supply and demand rather than fundamentals.” Some centers even took the unusual step of refusing to comment altogether after the index bands they had previously projected collapsed.

◇“Extreme Situation”: A Unified View
With the KOSPI index falling to the low 5,000s, the consensus is that current stock prices have entered a state of extreme undervaluation.
Cho Soo-hong, head of the Research Center at NH INVESTMENT & SECURITIES, stated, “Volatility in the Korean stock market has expanded to levels exceeding those seen during the financial crisis,” adding, “In a market driven not by fundamentals but by supply and demand—and in the absence of any clear negative factors—repeated sharp declines are dampening investor sentiment.”
Park Yeon-ju, Head of the Research Center at MIRAE ASSET SECURITIES, also noted, “While there are fundamental issues such as concerns over the peak in AI infrastructure investment and worries about capacity expansion in China, the large scale of the correction is largely due to supply-and-demand factors stemming from increased volatility.”
Yoo Jong-woo, Head of the Research Center at Korea Investment & Securities, stated, “Levels below 6,000 points represent extreme undervaluation,” noting that the sharp short-term decline has created buying opportunities at low prices. In contrast, some research centers declined to comment, noting that the index had already broken below its previous support level.
Han Ji-young, an analyst at KIWOOM Securities, analyzed in a commentary published today, “The essence of today’s plunge is panic selling, as the majority of stockholders are locking in losses following the retreat of rebound expectations after yesterday’s 10% plunge,” adding, “Explosive trading in single-stock inverse ETFs is also amplifying volatility.”
She noted that during the trading session, the KOSPI’s monthly decline exceeded the -37% range, while the forward price-to-earnings ratio (PER) fell below 5x and the forward price-to-book ratio (PBR) dropped to around 1.1x, describing these as “unprecedented levels.”
Center Director Cho Su-hong also pointed out that if the lower bound is set at the post-2025 average of 1.3 to 1.4 times based on the 12-month forward price-to-book ratio (PBR), “the KOSPI at 6,000 points would be at the rock-bottom level.”
◇“Industry Conditions Remain Solid” Despite SK hynix’s Weak Earnings
Regarding the earnings report from SK hynix(000660) —which served as the direct trigger for the day’s sharp decline—Center Director Park Yeon-ju commented, “As mentioned during the conference call, this was due to the postponement of shipments for some high-value-added products to the second half of the year,” adding, “The semiconductor market itself remains robust.” Center Director Hwang Seung-taek also predicted, “With rising memory prices, a shortage of High-Bandwidth Memory (HBM), and expanding demand for server DRAM all converging, the trend of improving earnings in the second half is highly likely to continue.”
This assessment—that psychological factors play a larger role than market conditions themselves—also applied to the recent concerns over supply from China. Regarding the potential impact of the listing of China’s CXMT on SamsungElectronics and SK hynix, Center Director Park Yeon-ju stated, “While there may be psychological concerns, even considering the pace of growth in China’s domestic demand and the scale of capacity expansion, the semiconductor supply-demand balance will remain tight through 2028,” assessing that the actual impact would be limited.
◇Foreign Selling Pressure Expected to Gradually Ease... “Gradual Buying Rather Than Panic Selling”
Regarding foreign investor sentiment—another factor that has recently exacerbated the index’s decline—he ruled out the possibility of a structural exodus.
Center Director Hwang Seung-taek said, “Rather than a structural reduction in holdings, this is largely driven by profit-taking following the first-half rally and portfolio rebalancing,” adding, “Given that selling has been concentrated on large-cap semiconductor stocks, it is reasonable to interpret this as a adjustment of weightings during a period of overheating in leading stocks.”
He cited the stabilization of the won, a slowdown in the rise of U.S. interest rates, and confirmation of earnings visibility during the second-quarter earnings season as conditions for the return of foreign capital. Center Director Cho Su-hong also predicted that “additional net selling pressure will gradually ease,” noting that foreign ownership in the semiconductor sector has fallen to historic lows.
Experts generally identified this week’s scheduled U.S. Federal Open Market Committee (FOMC) meeting and Big Tech earnings announcements as turning points for a market rebound. Researcher Han Ji-young noted, “The key will be whether U.S. hyperscalers, scheduled to report starting early tomorrow morning, demonstrate earnings and improved cash flow sufficient to allay profitability concerns, whether expectations for U.S.-Iran negotiations are reignited, or whether the July FOMC meeting concludes without incident.”
Center Director Hwang Seung-taek also noted, “If concerns over further monetary tightening do not intensify at the FOMC meeting and expectations for semiconductor earnings and shareholder returns are confirmed, the excessive downtrend will subside.”
Center Director Park Yeon-ju advised, “Since the decline in stock prices relative to fundamentals is excessive due to supply-and-demand issues, I recommend a strategy of gradual buying from a medium- to long-term perspective rather than panic selling,” but added, “Given that volatility may remain high, investors should be cautious about excessive leverage.”
Researcher Han Ji-young also stated, “At this point, the priority is to remain in the market and monitor developments and changes in market catalysts rather than engaging in panic selling,” adding, “A market reversal is most likely to occur when large volumes of capitulation selling emerge.”
Center Director Cho Su-hong predicted that the concentration of investment in sectors with high profit visibility would continue for the time being and identified the following as sectors of interest: △AI infrastructure (semiconductors, power equipment) △energy and securities (undervalued earnings stocks) △premium consumption (department stores, hotels; beneficiaries of exchange rates and inbound tourism).