DS Investment & Securities expressed an optimistic view on the 2nd quarter earnings season on the 19th, stating that the overall operating profit of the KOSPI is expected to approach the 2021 level.
Yang Hae-jung, head of investment strategy, said, "The 2nd quarter earnings season will begin next month," adding, "The current level of the index is maintained because earnings expectations are still alive."
He continued, "Looking at the overall operating profit of the KOSPI for the 2nd quarter, it is expected to reach a level close to the very strong 2021 on a quarterly basis," and added, "Estimates for major stocks in top market capitalization sectors such as semiconductors and automobiles are also being revised upward."
He went on, "Even exports, which can gauge earnings, were strong in April and May and have continued a good trend until mid-June," noting, "The export performance in April and May shows high growth rates (compared to the same period last year) in IT (semiconductors), shipbuilding, cosmetics, and pharmaceuticals."
Yang said, "The region leading Korean exports is the United States, and the indicator to gauge U.S. purchasing power is the value of the dollar," adding, "Although the dollar value has been sideways, it has not fallen significantly, which also means that purchasing power is still maintained."
He further stated, "Considering the cyclical recovery of the global economy and the trend of the dollar value, earnings expectations are likely to continue through the 3rd quarter," and predicted, "Since the discount rate variable of interest rates has entered a stable phase, future market growth drivers will be earnings."
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