20160726-三星证券-Perspectives_Weekly__Three_technical_indicators_warn_of_correction_19页_969kb

Samsung Market Strategy Summary

Core Content

This document outlines the current market strategy and analysis for both the Korean and global stock markets, focusing on technical indicators, sector performance, fund flows, and market valuations. It is authored by Samsung's financial analysts and strategists, highlighting key insights and recommendations for investors.

Main Points

1. US Market and Market Corrections

• Key US indices (e.g., DJIA) have set new highs, but technical indicators suggest potential for market corrections.
• The Dow Jones Transportation Average (DJT) has underperformed compared to the DJIA, indicating that the rally may not be driven by economic expansion.
• The S&P 500 has seen a decline in the percentage of constituents above their 50-day moving averages, suggesting a lack of broad market confidence.
• The equity put/call ratio has fallen to a low level, indicating bearish sentiment among investors.
• The document warns that unless there are aggressive policy measures or improved earnings, the rally may not continue.

2. Korean Market Outlook

• The Kospi has surpassed 2,000, but uncertainties in the second half of the year are expected to limit further gains.
• IT, energy, and utilities sectors show stronger EPS momentum, while transportation, semiconductor, and pharmaceutical sectors have improved.
• Global equity-type funds have experienced net outflows due to increased profit-taking, and domestic equity funds are also withdrawing capital.
• ETFs have seen a net exit, reflecting broader market sentiment.

3. Sector Analysis

• MSCI Korea sector dashboard highlights varying performance and valuations across different industries.
• Energy has shown strong forward P/E and P/B, while Materials and Steel have seen declines.
• Industrials (e.g., shipbuilding, construction, transportation) have mixed performance, with some sectors improving.
• Consumer Discretionary and Consumer Staples show varied EPS growth and valuations.
• Financials and IT sectors have different forward P/E and P/B, with IT showing stronger performance in some indicators.

4. EPS Forecast Changes

• Top 10 stocks based on EPS forecast changes include major companies like Samsung Electronics, LG Display, and Posco.
• Bottom 10 stocks show negative EPS forecast changes, indicating potential underperformance.
• Mid-sized and small-cap stocks also show mixed EPS growth expectations.

5. Market Valuations

• Forward P/E and P/B for MSCI Korea and Kospi show varying levels of valuation.
• The Kospi has a forward P/E of around 16.5, while Kosdaq has a higher forward P/E of 28.7.
• Forward P/B for MSCI Korea and Kospi are relatively low, suggesting potential undervaluation in some sectors.

6. Fund Flows

• Global fund flows show net outflows in EMs and DMs, with Asia ex Japan and Global being the main contributors.
• Domestic fund flows indicate a net outflow from equity-type funds, with domestic institutions and ETFs also showing exits.
• Kospi investors show a net outflow, with foreign investors and domestic institutions withdrawing capital.

Key Information

• Technical indicators suggest the potential for a market correction in the US, which could impact the Korean market.
• Sector performance varies, with some sectors showing strong EPS momentum while others lag.
• Fund flows indicate a general trend of profit-taking and capital outflows, both globally and domestically.
• Market valuations show that while some sectors may be undervalued, the overall market is not showing strong momentum.
• EPS forecast changes provide insights into expected earnings growth, with some stocks showing positive changes and others negative.

Conclusion

The document emphasizes the need for risk control and caution in the current market environment, as technical indicators and fund flows suggest a potential correction. It highlights sector-specific performance and valuation trends, offering insights for investors looking to navigate the market effectively. The Kospi and Kosdaq show mixed signals, with some sectors appearing undervalued and others underperforming. The S&P 500 and MSCI Japan are also under scrutiny for their valuations and potential earnings growth.