Global fund management leader calls out: Definitely bullish on the South Korean stock market, AI hardware demand is the biggest support.

With the easing signals of the US-Iran conflict and the continuous outbreak of artificial intelligence (AI) hardware demand, the South Korean stock market is once again gaining the dual favor of global top asset management giants and local individual investors. The world's largest asset management company, BlackRock, recently stated that South Korean stocks are the key DRIVE to its upward adjustment of emerging market ratings, and the "wait-and-see funds" domestically in South Korea, which dissipated with the shadow of the Middle East war, have also returned in large numbers recently, with the credit trading volume hitting a historic high. BlackRock: South Korean stock profit growth explodes, "absolutely bullish" on South Korean AI concept stocks BlackRock this week upgraded its rating of US stocks and emerging market stocks to "hold", stating that both types of assets have profit growth potential. Despite the continued tension in Iran, global corporate profit expectations for 2026 are still on the rise, with the AI theme becoming an important supporting factor. BlackRock's Chief Global Investment Strategist, Wei Li, said, "South Korea is an important reason for our upward adjustment of emerging market ratings. South Korea is at the core of the technology supply chain, showing strong growth momentum." She mentioned the strong demand for AI-related hardware in the market and explicitly stated, "We are absolutely bullish on the South Korean stock market." The most tangible data supporting this view comes from the astonishing surge in profit expectations. Compiled data shows that the expected forward earnings growth rate of the South Korean benchmark KOSPI index was 43% at the beginning of the year, and has now soared to around 170%. Despite the violent fluctuations caused by the geopolitical conflicts in the Middle East, the index is about to recover the previous declines, with a cumulative increase of 47% by 2026, outperforming most major stock indices globally. Addressing market concerns about the over-concentration of a few large chip stocks in the South Korean stock market, Li believes that during a period of technological transformation, this is a feature rather than a flaw. "People view concentration of individual stocks as a risk, but in fact, during a technological revolution, this is a feature of the current market environment," she said. "At present, we are not particularly concerned about this concentration issue." Geopolitical risks easing, local "major funds" returning to the market BlackRock's optimism is echoed in the situation of local funding in South Korea. With the United States and Iran indicating a willingness to renegotiate, market liquidity frozen due to war panic has quickly thawed. Data from the Korea Financial Investment Association on April 16th shows that as of April 14th, the balance of investor margin accounts reached 117.6724 trillion Korean won, the highest level in three weeks, and has returned to the level at the end of February before the eruption of the US-Iran conflict. Investor margin accounts are usually seen as "sideline funds" in the stock market, and the rapid expansion of their scale indicates a significant recovery in investor confidence. It is worth noting that since hitting the lowest point in this round of conflict on April 6th, boosted by the news of a "two-week ceasefire", this indicator has surged by more than 10 trillion Korean won in just 6 trading days. Although the first face-to-face ceasefire negotiations held in Islamabad last weekend broke down, both US President Trump and the Iranian side have expressed strong intentions to resume negotiations. Lee Kyung-min, a researcher at Daishin Securities, analyzed that Trump's remarks about "the war coming to an end" and "possible progress in the next two days" greatly boosted the market's expectations for the end of the war. At the same time, negotiations for a ceasefire between Israel and Lebanon are also seen as positive factors in easing the risk of the blockade of the Hormuz Strait. The signs of the stock market warming have quickly ignited the leveraged enthusiasm of South Korean individual investors. Data shows that as of the 14th, the balance of credit trading (funds known as "borrowing money to speculate on stocks") has climbed to 33.2824 trillion Korean won, of which the credit balance in the main board Kospi market alone has reached 23.406 trillion Korean won, setting a new record high. The flow of funds shows that this round of credit expansion is highly concentrated in the semiconductor sector. Taking the industry leader Samsung Electronics as an example, its credit financing balance has reached 3.4126 trillion Korean won, an increase of 107% from the end of last year and 47% from the outbreak of the conflict. SK Hynix also saw a 30% increase in credit balance to 2.2656 trillion Korean won during the same period. Market analysis believes that the better-than-expected performance of semiconductor giants is the core catalyst attracting high-risk preference funds. Despite the supply chain concerns caused by the war, Samsung Electronics announced a quarterly operating profit of 57 trillion Korean won on the 7th, far exceeding market expectations, greatly restoring investor confidence in the fundamentals of technology stocks.