Bear-market rally expected in August

Bear-market rally expected in August

By Anna J. Park

 

Analysts predict that the current bear market will continue to recover until August, as the stock market closed in July with a gradual recovery after several months of market revisions. The key benchmark KOSPI closed at 2,451.50 on July 29, the last trading session of the month, up 5.1% from the end of the previous month.

The benchmark index fell to 2276.63 during a trading session in early July on rising inflation and growing concerns about the global recession. Nevertheless, the local stock market gradually recovered in July as the market was already pricing with most of the negative expectations.

Local brokerage firms believe the index could rise to 2,650 and expect the market to continue its positive momentum in August. The Kyo Guarantee Ticket was the most bullish and the KOSPI expected to rise to 2,650 points in August.

Similarly, the outlook for August is good for other major securities companies, with Kiwoo Securities having 2,600 points, Samsung Securities having 2,550 points, and South Korea investment having 2,500 points.

However, due to high inflation and the burden of monetary tightening, the rally is expected to show a limited recovery within a limited range.

“The KOSPI index succeeded in recovering in July, but it is necessary to maintain this momentum in August as the price-earnings ratio (P / E) rises,” said Kim Dae-jun analyst, a Korean investment investor. Said. Securities, notes.

Another analyst agrees that it is difficult to predict an actual recovery given the Fed’s policy tightening and slowing corporate growth. Nonetheless, the temporary bear market recovery should continue in August.

“Despite the unfavorable macroeconomic factors, the bear market’s potential for recovery is clear,” said Na Jeong-hwan, an analyst at Cape Investments & Securities. “However, if the index rises faster and sharper, one should watch out for earnings per share (EPS) gains. may fluctuate within,” the analyst added.

Meanwhile, foreign investors turned to monthly net purchases in July. They net bought 1.8 trillion won ($1.37 billion) worth of local stocks, the highest level since December last year.

 

Credit/Source : KoreaTimes

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