Lates News

Morgan Stanley has upgraded its rating on South Korean stocks from "equal weight" to "overweight," stating that the recent "leveraged unwind" has provided better entry points for investors to participate in artificial intelligence trading and the industrial supercycle theme. Strategists, including Daniel K Blake, wrote in a report that with significant unwinding of crowded trades and leveraged positions, the South Korean KOSPI index still has a 36% upside to its target of 9,000 points. On Monday, the index fell by as much as 5.5% after a record 18% rise on Friday. Analysts noted that the recent selloff was "primarily driven by technical factors" and stated that "the deleveraging process of leveraged ETFs, hedge fund leverage, and retail margin trading has passed the halfway mark." Morgan Stanley expects the KOSPI index to fluctuate in the short term between 5,500 and 10,500 points and believes that Samsung Electronics and SK Hynix will provide valuation support for the market; stocks in sectors such as industrials, defense, and finance are expected to benefit from favorable factors.