Samsung Electronics Strong Earnings Growth
Succession and Political Theme Issues Included
[Asia Economy Reporter Junho Hwang] On the 7th, the stock market closed higher after two trading days. Despite the ongoing aftershocks of last year's year-end ex-dividend period and the impact of the U.S. tightening policy, various factors such as rebound buying following the previous decline, Samsung Electronics' earnings announcement, and the strong dollar helped maintain the upward trend. With continued foreign inflows, attention is focused on whether the KOSPI will surpass 3000 and the KOSDAQ 1000 next week.
On this day, the KOSPI closed at 2954.89, up 1.18% (34.36 points) from the previous session. Although individual investors, who had been net buyers early in the session, turned to net selling, foreign investors maintained the upward momentum by net buying stocks worth 499 billion KRW. Individuals and institutions sold 245.1 billion KRW and 241.5 billion KRW, respectively.
In particular, among institutions, the financial investment sector of securities firms, which invest company funds in stocks, sold off 393.7 billion KRW, increasing downward pressure. This appears to be a measure to unwind the net purchases made just before the year-end dividend record date last year at the beginning of this year.
Samsung Electronics Closes Higher
Samsung Electronics achieved record-high performance with annual sales exceeding 279 trillion won. On the 7th, Samsung Electronics announced that its preliminary consolidated results for last year showed sales of 279.04 trillion won and an operating profit of 51.57 trillion won. Employees are arriving at Samsung Electronics Seocho Office on this day. Photo by Moon Honam munonam@
Among all stocks, 648 rose while 207 fell. Among the top market capitalization stocks, Samsung Electronics, the perennial leader, rebounded from its previous slump by rising 1.82% to 78,300 KRW. Samsung Electronics announced its Q4 earnings on this day, reporting operating profit below market expectations but sales exceeding them. Samsung Electronics reported consolidated sales of 76 trillion KRW and operating profit of 13.8 trillion KRW for Q4 (September to December) last year. Sales increased by 2.73% compared to 61.55 trillion KRW in the same period last year. Operating profit also rose 52.49% from 9.05 trillion KRW in Q4 of the previous year. However, operating profit fell short of the securities market consensus of 15.7 trillion KRW.
Lee Kyung-min, a researcher at Daishin Securities, said, "Although Samsung Electronics' operating profit fell short of consensus, sales exceeded expectations. Annual sales reached an all-time high, expanding expectations for the semiconductor industry, which in turn attracted continued foreign inflows."
Succession and Political Tailwinds
Along with Samsung Electronics, SK Hynix, grouped in the same semiconductor sector, closed at 127,000 KRW, up 1.60% from the previous session. Among the top 10 stocks, LG Chem recorded the highest increase, rising 4.20%. LG Chem has risen for five consecutive trading days through this day. Prior to this, LG Chem had been on a downward trend since Q4, ahead of LG Energy Solution's KOSPI listing scheduled for the 27th.
By sector, notable gains were seen in chemicals (2.63%), textiles and apparel (2.17%), food and beverages (1.90%), and electrical and electronics (1.65%). In the chemical sector, Hyosung TNC stood out with a 9.74% rise to 586,000 KRW. Expectations for dividends increased due to the purchase of shares by the fourth-generation owner of the Hyosung Group, along with optimism from expanding demand for spandex. Due to the dramatic reconciliation between Yoon Seok-yeol, the People Power Party's presidential candidate, and Lee Jun-seok, the party leader, Deokseong, considered a theme stock, closed up 5.76% at 15,600 KRW.
KOSPI 3000 and KOSDAQ 1000 Not Surpassed, But...
On the 6th, KOSPI opened at 2,927.50, down 26.47 points (0.90%) from the previous trading day. Dealers are working in the dealing room at the Hana Bank headquarters in Jung-gu, Seoul. On the same day, the won-dollar exchange rate started trading at 1,200.9 won, up 4.0 won from the previous trading day. Photo by Jinhyung Kang aymsdream@
The KOSDAQ closed at 995.16, up 14.86 points (1.52%) from the previous session. Individuals and foreigners led the index rise with net purchases of 24.1 billion KRW and 57.5 billion KRW, respectively. Institutions, similar to the KOSPI, limited the index's rise by net selling 84 billion KRW.
Among all stocks, 1,111 rose while 273 fell. Among the top market capitalization stocks, gaming stocks showed notable gains. Wemade recorded a 9.12% increase to 150,800 KRW compared to the previous session.
The won/dollar exchange rate rose to as high as 1,204 KRW during the session but closed with a reduced gain due to easing dollar strength pressure and foreign investors' net buying in the stock market. It closed at 1,201.50 KRW, up 0.04% from the previous session.
Lee Jae-sun, a researcher at Hana Financial Investment, said, "Next week, the domestic stock market is expected to continue a limited upward trend. January's U.S. employment and inflation data are likely to support the Federal Reserve's rationale for raising interest rates, but the rising won/dollar exchange rate could, conversely, enhance export companies' price competitiveness, raising expectations for margin improvement."
Next week’s schedule includes the JP Morgan Healthcare Conference (January 10?13), the Federal Reserve Beige Book release (January 12), and the Bank of Korea Monetary Policy Committee meeting (January 14).
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