South Korea’s main bourse erased gains of the year after hitting the lowest since December on Tuesday, but analysts project Kospi strengthening from the second quarter to peak at around 3,400 in May or June on improved earnings and bargain hunting from excessive anxiety over the economic impact from the rise of a new virus variant and inflation.

The Kospi on Wednesday rebounded by strong 2.14 percent to close at 2,899.72 from the annual low of 2,839.01 on Tuesday as foreign and institutions reversed to heavy buying after a hectic selling spree in just a day.

Foreigners and institutional investors on Wednesday bought 906.8 billion won ($768.8 million) and 91 billion won worth on the Kospi, respectively. They offloaded a net 143 billion won and 635 billion won on Tuesday, respectively.

Most large caps bounced back from the sharp dip of the previous day. Market bellwether Samsung Electronics jumped 4.35 percent to end at 74,400 won, SK hynix added 2.19 percent to 116,500 won and Naver climbed 2.36 percent to 390,000 won.

Despite the year-end bear that may run up to the first months of the year due to lingering uncertainties, brokerage houses were more or less positive about the Kospi performance in the new year.

In their market predictions for 2022, they generally agreed on the Kospi going as high as 3,400 in the second quarter.

“The Kospi is expected to rise in the first half of next year to hit a high point in May or June on the anticipated recovery in the global economy on eased supply shortages,” explained an analyst at NH Investment & Securities.

According to financial data provider FnGuide, 272 listed companies are forecast to raise a total of 242.4 trillion won in operating profit in 2022, up more than 8 percent from 223.4 trillion won this year. The growth will be led mostly by chip, display, battery, retail and entertainment names, said an analyst at Yuanta Securities.

Top-cap Samsung Electronics is expected to deliver 55.1 trillion won in operating income next year, up more than 4 percent from 52.8 trillion won this year.

By Kang Bong-jin, Cha Chang-hee, Kim Jung-beom and Lee Soo-min

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]