Morgan Stanley upgraded South Korea's stock rating from flat to high, saying that the recent “clearance of leverage” has provided investors with better entry opportunities to participate in artificial intelligence trading and industrial supercycle topics. As Daniel K Blake and other strategists wrote in the report, the Kospi Index still has room to rise 36% from its target of 9,000 points due to crowded transactions and drastic liquidation of leveraged positions. The index fell 5.5% on Monday and rose by a record 18% on Friday. Analysts said that the recent sell-off was “mainly due to technical factors,” adding that “the deleveraging process for leveraged ETFs, hedge funds, and retail margin trading is halfway through.” The Kospi Index has accumulated a cumulative decline of more than 30% since its June high. As a trend vane for artificial intelligence demand in Asia, the Korean stock market was quickly sold off by investors, and the surge in individual leveraged ETFs and excessive concentration of index weight further exacerbated this round of decline. Morgan Stanley expects the Kospi index to fluctuate between 5,500 points and 10,500 points in the short term, and believes that Samsung Electronics and SK Hynix will provide valuation support to the market; stocks in industries such as industry, defense, and finance are expected to benefit from favorable factors.

Morgan Stanley upgraded South Korea's stock rating from flat to high, saying that the recent “clearance of leverage” has provided investors with better entry opportunities to participate in artificial intelligence trading and industrial supercycle topics. As Daniel K Blake and other strategists wrote in the report, the Kospi Index still has room to rise 36% from its target of 9,000 points due to crowded transactions and drastic liquidation of leveraged positions. The index fell 5.5% on Monday and rose by a record 18% on Friday. Analysts said that the recent sell-off was “mainly due to technical factors,” adding that “the deleveraging process for leveraged ETFs, hedge funds, and retail margin trading is halfway through.” The Kospi Index has accumulated a cumulative decline of more than 30% since its June high. As a trend vane for artificial intelligence demand in Asia, the Korean stock market was quickly sold off by investors, and the surge in individual leveraged ETFs and excessive concentration of index weight further exacerbated this round of decline. Morgan Stanley expects the Kospi index to fluctuate between 5,500 points and 10,500 points in the short term, and believes that Samsung Electronics and SK Hynix will provide valuation support to the market; stocks in industries such as industry, defense, and finance are expected to benefit from favorable factors.