"Chip-led rally eyes '5,000 KOSPI'…but profit-taking overhang looms" [Weekly outlook]

NH Investment & Securities: "KOSPI 4,250–4,700"

KOSPI earnings estimates revised up in succession

JPMorgan Healthcare Conference seen as catalyst for biotech stocks

"Profit-taking pressure expected to intensify after sharp short-term gains"

Brokerages expect the KOSPI to extend its upward trend this week (12–16), driven by continued upward revisions to corporate earnings forecasts led by semiconductor names such as Samsung Electronics and SK hynix. They caution, however, that profit-taking pressure after the recent sharp rise could cap further upside.

According to the financial investment industry on the 11th, NH Investment & Securities presented this week’s expected KOSPI range at 4,250–4,700. That implies maximum upside of about 2.48% from the previous week’s last trading day close (4,586.32).

The securities industry is focusing on the continued expansion of earnings momentum. After Samsung Electronics announced operating profit of 20 trillion won for the fourth quarter of last year, KOSPI earnings forecasts have also been revised upward. The KOSPI net profit consensus (the average estimate among brokerages) stood at 309.5 trillion won at the end of last year, but has risen 8.53% to 335.9 trillion won as of the 8th.

Of that, the combined net profit forecast for Samsung Electronics and SK hynix totaled 159.9 trillion won, accounting for 47.6% of the overall figure. Demand for both advanced and commodity memory semiconductors is surging as global big tech companies ramp up investment in artificial intelligence (AI) infrastructure.

Na Jeong-hwan, an analyst at NH Investment & Securities, said, "Given the possibility of additional upward earnings revisions centered on semiconductors, the current 12-month forward price-to-earnings ratio (PER) of 11.4 times still leaves room for valuation appeal (the stock price level relative to earnings) to stand out further."

Another view is that the JPMorgan Healthcare Conference—the world’s largest investment event for the pharma and biotech industries, to be held on the 12th—could help lift investor interest in the biotech sector. Korean companies set to make official presentations include Samsung Biologics, Celltrion, D&D Pharmatech, and Alteogen, offering a chance to review their business plans and strategies.

Lee Hee-young, an analyst at Daishin Securities, said, "The technology-transfer cycle for Korean companies tends to gain full momentum after the event," adding, "Technology-transfer discussions that have been delayed since the second half of last year are highly likely to resume starting from this event." She added that "rather than worrying about a short-term event fade (sell-on) after the conference, investors should focus on selecting quality companies aligned with the global trends confirmed at the conference."

Meanwhile, the US December Consumer Price Index (CPI), scheduled for release on the 13th, is expected to come in at 2.7%—the same level as the previous month—suggesting concerns about a reacceleration in inflation will be limited.

Still, with the KOSPI having surged in a short period, including breaking above 4,600 since the start of the year, profit-taking pressure is expected to persist. Na said, "There is a need to be mindful of the possibility of short-term profit-taking selling," adding, "That aside, the major factors for this week are broadly supportive of the stock market."

Ko Jeong-sam, Hankyung.com reporter jsk@hankyung.com