Kyobo Securities "Sufficient Investment Appeal in KOSPI for April... Up to 2940 Level Possible"

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] Kyobo Securities forecasted that the KOSPI index could rise up to the 2940 level in April.

According to Kyobo Securities on the 1st, the Korean stock market has so far preemptively reflected momentum slowdown. Therefore, if fundamental damage is limited, it is expected to return to an appropriate value level. Regarding this, Kim Hyung-ryul, Head of the Kyobo Securities Research Center, explained, "The KOSPI, which was below 2700 points, has sufficient investment attractiveness," adding, "Touching 1.1 times based on the 12-month expected earnings and then limiting further decline means it is positioned at a level with strong low-price recognition."

Kyobo Securities presented the expected band for the KOSPI index in April as 2600 to 2800. Head Kim said, "The stock market in March continued its rebound following last month, but the rebound level was disappointing," and explained, "It has become somewhat free from the burden of the US Federal Reserve's (Fed) interest rate hikes, but it failed to maintain a preemptive advantage over other risk assets."

He predicted, "The stock market in April can be approached as an extension of the short-term rebound," adding, "Excessive concentration on safe assets revives the cyclical price advantage of risk assets, and the limited fundamental damage is expected to be an investment incentive." However, he cautioned, "Interpreting that the index will start to rise just because it has hit the bottom is too premature," and said, "The 3000 level, where it stayed until last year, was a story of not only strong momentum recovery but also a time when liquidity overflowed in the financial market."

Head Kim analyzed, "The KOSPI index is likely to remain in the range of 2680 to 2940, which corresponds to a price-to-book ratio (PBR) of 1.0 to 1.1 times, until the second quarter earnings are confirmed."