00:003 numbers before the open. A 19-basis point drop in U.S. Treasury yields in one day,
00:06112 trillion won wiped from Korean ETF assets, and Goldman Sachs cutting its Cosby target by 25%.
00:133 numbers before the open. A 19-basis point drop in U.S. Treasury yields in one day,
00:19112 trillion won wiped from Korean ETF assets, and Goldman Sachs cutting its Cosby target by 25%.
00:273 numbers before the open. A 19-basis point drop in U.S. Treasury yields in one day,
00:33112 trillion won wiped from Korean ETF assets, and Goldman Sachs cutting its Cosby target by 25%.
00:40Here's what today's story could mean for the Korean market.
00:43It's Monday, October 26. Here's what today's story could mean for the Korean market.
00:48The Cosby has fallen more than 35% from its June peak, and the sell-off reached far beyond the
00:53index. Foreign and retail money has been moving in very different directions.
00:57Let's go through the drivers that matter most for the open. Here's the number that matters most.
01:01The U.S. 10-year Treasury yield fell to 4.953% on October 22, its biggest one-day drop
01:08since March
01:092023. That move was driven less by confidence and more by a rush into safe assets, as tech stocks sold
01:16off and fears around big tech credit spread. Oil stayed above $100 a barrel, yet yields still fell,
01:22which tells you the market is pricing fear over inflation. Tech stocks sold off and fears around
01:28big tech credit spread, pushing money into safe assets. Domestically, the picture is just as
01:33sharp. Korean ETF net asset value stood at 416.8 trillion won on October 25, down 21% from the
01:41June record of 528.8 trillion won. Retail investors bought a net 80 trillion won in ETFs this year
01:49through October 23. Codex 200 and Tiger 200 together drew 1.4 trillion won in the past week,
01:56while leveraged products like Codex Semiconductor Leverage lost more than 10% over the same window.
02:02Buyers are betting on a rebound, but they are doing it with very different levels of risk.
02:06Look at the valuation gap. Goldman Sachs lowered its 12-month COSPI target to 9,000 from 12,000,
02:12yet that still implies more than 60% upside from the current level near 5,550.
02:18The forward price-to-earnings ratio has dropped to roughly 4 times,
02:22the lowest among 18 major global markets since 2006. The forward price-to-earnings ratio has
02:28dropped to roughly 4 times, the lowest among 18 major global markets since 2006.
02:34Goldman's analysts argue that the semiconductor sector is pricing in a 65% drop in next year's
02:40earnings, which they see as overly pessimistic. So what does this mean for stock investors heading
02:45into this week? The sharpest signal is the disconnect between treasury yields and equity
02:49risk. When safe-haven demand outweighs oil-driven inflation, the stock market loses its usual cushion,
02:56and index moves can swing sharply in either direction. Heavy inflows into leveraged ETFs and
03:01money market funds at the same time suggest that investors are preparing for both a rebound
03:06and a further drop. SK Group's market value fell 30% this month, driven largely by SK Hynix and SK
03:13Square, while LG Group held steady. Watch whether semiconductor weakness spreads further this week.
03:19Watch whether the Fed's decision on October 27 and 28 shifts yields again. And watch whether Samsung's
03:25final third-quarter results on October 29 can stabilize sentiment and memory chips.
03:29That's today's AI Prism, stock investors. This episode was produced with AI assistance based on
03:35Seoul Economic Daily Reporting. AI Prism is a Juan IFRA award-winning series. We'll be back tomorrow.
