Is the KOSPI Bottoming Out? Inside Hana Securities' Contrarian Call

An Analyst Who Called the Top Is Now Calling the Bottom

On May 18, 2026, Hana Securities' Head of Global Investment Analysis, Lee Jae-man, published a report titled "KOSPI, Entering the 10,000-Point Era," in which he flagged a specific signal that would mark the peak of the current bull run: the moment SK Hynix's market capitalization overtook Samsung Electronics'. That signal fired on June 22, and the KOSPI closed that same day at an all-time high of 9,114.55. From there, the index reversed sharply, culminating in an intraday drop of more than 8% on July 13 that triggered a circuit breaker and pushed the index below the 7,000 level.

With that call having played out almost exactly as forecast, the market's attention turned to what the same analyst would say next. On July 10, he published a new report — this time arguing the opposite. According to Lee, the bottom is now in.

Argument 1: The "Maximum Drawdown" Pattern

The first leg of the thesis rests on historical pattern analysis. Looking at KOSPI corrections since 2023, the report finds that the index's peak-to-trough decline has topped out at roughly 20% in every cycle.

Applying that pattern to the current downturn produces the following:

- Cycle peak: 9,114 points

- Implied trough at a 20% maximum drawdown: approximately 7,290 points

- The index has already reached that level

In other words, if 20% has historically marked the outer bound of how far KOSPI corrections go, and the index has already fallen that far, the balance of probability now favors a technical rebound over further downside. Based on this, the report sets a short-term rebound target of 9,240 points.

Argument 2: A Bottom-Up Valuation Case

The second pillar of the thesis is fundamentals-driven. The logic follows the standard equity valuation identity — index level as aggregate earnings multiplied by an applied earnings multiple (P/E) — using the following inputs:

- Projected aggregate net income for KOSPI-listed companies in 2027: KRW 946 trillion

- KOSPI's historical average P/E since 2010: 9.96x

- Resulting implied fair value: approximately 11,450 points

This calculation underpins the report's long-term target of 11,450 — consistent with the "10,000-point era" thesis first laid out in the May report.

The Core Argument: Sentiment-Driven Selloff, Not Fundamental Damage

Taken together, the report's central claim is that the recent selloff reflects a sharp deterioration in investor sentiment rather than any actual damage to corporate earnings power or industry structure. Earnings capacity and valuation support, in this view, remain intact — and the energy for the index to eventually clear the 10,000-point mark is, if anything, already building.

The report does address bear-case concerns directly, including worries about KOSPI's heavy concentration in semiconductors and the risk of a slowdown in Big Tech capital expenditure. Notably, it pinpoints when that risk narrative is likely to intensify: the third quarter of 2027, when capex growth is expected to fall below revenue growth for major tech spenders.

## A Note for International Readers

This is the view of a single sell-side analyst, and other market participants hold materially different opinions on where KOSPI is headed from here. Both the drawdown-pattern argument and the valuation model rest on assumptions — that historical drawdown limits will repeat, and that current earnings projections will materialize — that may or may not hold in this cycle. Foreign investors weighing exposure to Korean equities should cross-reference multiple sell-side views and monitor incoming data (FX, Bank of Korea policy, and semiconductor capex trends in particular) rather than relying on a single house view.

This article is for informational purposes only and does not constitute investment advice.

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*This piece is based on media coverage of a Hana Securities research report published in South Korea in July 2026.*