William Bratton, head of cash stock research at BNP Paribas, said that fluctuations in the South Korean stock market highlight the disconnect between its technology companies and profit prospects. Bratton said that so far this year, the Korea Composite Index has accounted for 79% of the major Asian indices rising and falling by more than 5% in a single day. These fluctuations “make the appeal of this market confusing”. The forecast for semiconductor and hardware earnings for 2027 and 2028 has been raised, while overall forward earnings have increased 7% since the end of June. As a result, the sell-off appears to be driven more by anxiety about the enduring nature of AI spending, he said. “We expect market volatility to remain high, and the country is at the center of the debate on the sustainability of the AI-driven tech supercycle and the ensuing clash of opinions,” he said.

William Bratton, head of cash stock research at BNP Paribas, said that fluctuations in the South Korean stock market highlight the disconnect between its technology companies and profit prospects. Bratton said that so far this year, the Korea Composite Index has accounted for 79% of the major Asian indices rising and falling by more than 5% in a single day. These fluctuations “make the appeal of this market confusing”. The forecast for semiconductor and hardware earnings for 2027 and 2028 has been raised, while overall forward earnings have increased 7% since the end of June. As a result, the sell-off appears to be driven more by anxiety about the enduring nature of AI spending, he said. “We expect market volatility to remain high, and the country is at the center of the debate on the sustainability of the AI-driven tech supercycle and the ensuing clash of opinions,” he said.