[Click eStock] "Focus on Visible Numbers... Semiconductors, Hardware, Healthcare in Spotlight"

Kim Dae-jun, a researcher at Korea Investment & Securities, released a report titled "Focus on the Visible Numbers" on the 3rd, urging to "pay attention to both export performance and profit forecasts simultaneously."

The government disclosed the export performance for May. It confirmed double-digit export growth rates and the highest monthly trade surplus. Among the items, IT sectors such as semiconductors and hardware performed well. Biohealth also increased compared to the same month last year. It is analyzed that the market should respond focusing on sectors with strong export performance and high profit revision ratios.

Last week, the KOSPI was sluggish. The rise in market interest rates and the depreciation of the Korean won stimulated net selling by foreigners, which contributed to the widening decline in the index. As a result, the KOSPI fell to the 2630-point level. With the macro environment shaken, the KOSPI also experienced increased volatility. Various macro indicators are scheduled to be announced this week, so the market may remain cautious.

The fortunate point is that the export results for May, announced over the weekend, showed favorable outcomes. According to the Ministry of Trade, Industry and Energy, May exports increased by 11.7% year-on-year to $58.15 billion, while imports decreased by 2% to $53.19 billion. The trade balance improved by $2.4 billion from the previous month, recording a surplus of $4.96 billion. This is the largest monthly trade surplus this year, which is expected to have a positive effect in reducing fluctuations in the KRW-USD exchange rate.

Export performance of the 15 major items was also largely favorable. Ship exports surged based on the high ship prices at the time of past orders. Semiconductors, which have established themselves as a leading sector in the Korean stock market, maintained a growth rate of over 50% year-on-year. Considering the number of working days, the average daily exports in May increased by 50.9%. IT and biohealth sectors, including computers related to SSDs, displays, and wireless communication devices, also saw exports increase compared to last year. In particular, these sectors showed improvement not only in growth rates but also in absolute export amounts compared to the previous month.

Since exports are not shrinking and maintaining an upward trend, there is expected to be no significant change in profit forecasts across sectors. It is interpreted that responding to the market based on profit forecasts remains valid. Especially, focusing on industries with strong export performance and stable profit forecasts is expected to be advantageous in terms of performance.

Researcher Kim Dae-jun said, "If you choose sectors where exports are increasing and profit revision ratios are maintained, semiconductors, hardware, and healthcare are selected," adding, "Although itemized performance has not yet been disclosed, if export growth is confirmed in non-ferrous metals, food and beverages, and cosmetics, the upward rally can continue."