Political Theme Stocks Unable to Gain Momentum Amid Domestic Stock Market Rebound

Robotics and Quantum Technology Stocks Rally
Growth and Oversold Stocks Attract Attention Amid Market Rebound
Political Theme Stock Concentration Eases

As the domestic stock market has strongly rebounded this year, political theme stocks that surged at the end of last year have lost momentum. With attention shifting to themes related to robots and quantum computing ahead of the world's largest home appliance and IT exhibition 'CES 2025,' political theme stocks are relatively being sidelined. The rebound in President Yoon Seok-yeol's approval rating is stimulating profit-taking desires in political theme stocks.

According to the financial investment industry on the 7th, the stock price of Orient Precision dropped 14% over the past two days. Considering that the KOSDAQ index rose 4.6% during the same period, the market-relative return is -18.6%. Not only Orient Precision, but political theme stocks such as Estaco, Cas, Koiz, and CS are showing a weak trend simultaneously.

Political theme stocks surged after the 'December 3 Emergency Martial Law' incident last year. Orient Precision rose 520.7% from the 4th of last month to the 2nd of this month. The stock price, which was only 1,131 won just before the emergency martial law incident, surpassed 7,000 won within a month. The continuously rising Orient Precision stock price fell 6.8% on the 3rd and dropped nearly 8% again on the 6th.

The rapid rise in stock prices over a short period increased the desire for profit-taking, and with signs of recovery in the domestic stock market, the focus on political theme stocks appears to have diminished. A financial investment industry official explained, "Political theme stocks surged in the absence of leading stocks in the domestic stock market at the end of last year," adding, "With the new year, new technology-related stocks such as robots and quantum computing have shown strength, resulting in a theme diversification effect."

This year, quantum computing-related stocks such as Korea Advanced Materials, Aton, and Lanix have surged. They rose 68.8%, 55.7%, and 41.1% respectively in just three trading days. The United Nations designated this year as the 'International Year of Quantum Technologies.' Since Google announced the quantum chip 'Willow' on December 10 last year, expectations for quantum technology have grown among domestic investors. As the related theme has spread this year, the rapid rise in stock prices has continued.

Robot-related stocks were stimulated by Samsung Electronics becoming the largest shareholder of KOSDAQ-listed Rainbow Robotics. Rainbow Robotics has risen 43.2% this year.

Along with EcoPro BM, which fell sharply last year, secondary battery-related stocks have also rebounded, pushing the KOSDAQ index up 5.9% this year. Expectations are growing that the KOSDAQ market's rebound trend will continue for the time being. Interest that was concentrated on political theme stocks seems to be dispersing toward growth stocks.

The increased variables in the political sphere are also affecting the stock price trends of political theme stocks. A recent public opinion poll showed that President Yoon Seok-yeol's approval rating has recovered to the 40% range after the National Assembly passed the impeachment motion that suspended his presidential duties. With the Constitutional Court conducting the impeachment trial of President Yoon, it is difficult to predict the timing of the next presidential election. As uncertainty grows, the desire for profit-taking in political theme stocks is interpreted to have increased.