Kospi Takes a Breather After Briefly Clearing 8,000; Nvidia, Samsung in Focus

NH Investment & Securities sees the Kospi moving between 7,200 and 8,100 this week

The Kospi is entering a breather this week, from May 18 to May 22, as investors weigh risks at home and abroad, including the war in the Middle East and the possibility of a strike at Samsung Electronics. Brokerages cited Nvidia earnings and lower oil prices as potential tailwinds, while a Samsung strike and profit-taking could pressure the market.

NH Investment & Securities on May 17 projected the Kospi would trade in a range of 7,200 to 8,100 this week. Na Jung-hwan, an analyst at the firm, said a key positive factor ahead of Nvidia’s May 20 earnings release is the issue of approval for sales of its H200 artificial-intelligence chip in China. If supplies to major Chinese companies such as Alibaba and Tencent resume, China revenue previously excluded from estimates could be added back into forecasts.

Investors will be watching Nvidia’s earnings for signs of whether the company has incorporated a China sales outlook into its plans. They are also focused on whether robust demand for Nvidia’s Blackwell AI chips will continue and how much production and supply bottlenecks have eased. The market is also looking for the company’s view on whether any increase in China revenue would be temporary or part of a sustained trend.

Samsung Electronics’ labor situation could also have a major effect on the Kospi. Na said the company’s semiconductor division is reported to have started reducing output. A labor deal would increase costs, while a strike could lead to production disruptions, raising concerns about Samsung’s earnings. He advised investors to diversify into blue-chip stocks with earnings momentum if volatility in Samsung shares widens because of strike-related concerns.

Yuanta Securities said strike concerns are already reflected in Samsung’s share price and could instead present an opportunity. Lee Jae-won, an analyst at the firm, said Samsung’s earnings outlook could improve further if uncertainty over a strike does not drag on. He added that Samsung shares, which have lagged other semiconductor stocks, could rise later and catch up with the broader market.

From a strategy perspective, brokerages said it still makes sense to maintain heavy exposure to market leaders such as semiconductor stocks for now. But after sharp gains in recent weeks, investors also need to prepare for rotational trading into companies whose shares have fallen steeply while earnings remain solid.

Daishin Securities pointed to batteries, cosmetics, defense and shipbuilding as sectors with attractive valuations and profit growth prospects this year. The firm said finding fresh opportunities in these undervalued groups will be key to generating returns above the market average.

The risk of additional profit-taking remains a burden. On May 15, the previous trading day, the Kospi and Kosdaq plunged more than 6% and 5%, respectively. The Kospi briefly topped 8,000 during the session but closed at 7,493.18, down 488.23 points, or 6.12%, from the previous day as profit-taking weighed on the index. US stocks also fell later in New York, with technology shares leading the decline as investors locked in gains. The Dow Jones Industrial Average dropped 537.29 points, or 1.07%, to 49,526.17. The S&P 500 fell 1.24%, while the tech-heavy Nasdaq Composite slid 1.54%.

Kang Jin-hyuk, an analyst at Shinhan Investment & Securities, said tensions in the Middle East intensified again after US President Donald Trump delivered a hard-line warning to Iran. Improving sentiment toward US-China relations also weakened expectations for South Korean companies that had been seen as beneficiaries of supply-chain decoupling. That prompted heavy selling by foreign and institutional investors in large-cap stocks such as Samsung Electronics and SK Hynix, sharply shaking the broader market.

Kang Kyung-joo, Hankyung.com reporter qurasoha@hankyung.com