[Forum Commentary] Ten Priorities the Forum Asks of the Government to Complete Capital Market Reform — KOSPI at a Crossroads Between 7,000 and 3,500 (January 27, 2026)
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![[Forum Commentary] Ten Priorities the Forum Asks of the Government to Complete Capital Market Reform — KOSPI at a Crossroads Between 7,000 and 3,500 (January 27, 2026)](/uploads/2026/01/Screenshot_20260128_180106_Samsung-Internet.jpg)
The semiconductor industry, a representative cyclical (Cyclical) stock, sees its P/E ratio fall the closer it gets to peak earnings (Peak earnings).
The fact that Samsung Electronics' projected 2026 P/E ratio is 8 times and SK Hynix's is 6 times means that these stocks' prices are not far from their earnings peak.
At last week's Davos Forum, Elon Musk warned that, because AI chip production is surging while the increase in energy supply is limited, (except for China) global semiconductors could enter a state of oversupply worldwide as early as the end of this year.
If the semiconductor cycle turns down and capital market reform retreats, the KOSPI could plunge as far as 3,500.
By contrast, if corporate governance reform continues to be pushed forward, an index of 6,000 or even 7,000 is also possible. Once investors are confident their protection is assured, foreign capital will keep flowing in. The National Assembly and the government should pursue a strategy of raising the stock market's floor through capital market reform.
Artificial stimulus measures for KOSDAQ are not desirable. There will be major after-effects later.
The KOSPI has many stocks that are undervalued relative to their fundamentals, so resolving the valuation discount through improved governance is the right answer.
KOSDAQ, however, has fundamentals that have deteriorated considerably and its valuation is already on the high side.
The way to revive KOSDAQ is to boldly and swiftly delist insolvent companies, even if it becomes a political burden.
