“Expect the Cost Reduction in the Appearance of Deep Chic”
The domestic stock market experienced a significant shake-up following the Lunar New Year holidays, driven by the emergence of China’s artificial intelligence (AI) chatbot, Deep Chic. This advancement has sparked a renewed interest in previously overlooked sectors, including financial stocks, Naver, and Kakao, which have shown remarkable strength in recent trading sessions.
According to the Korea Exchange on January 31, Naver closed at 21,6500 won, marking a 6.13% increase from the previous trading day. This surge came after a 2.56% rise earlier in the month, which was less than half of the KOSPI growth rate of 5.72%. Similarly, Kakao, which had been stagnant at the start of the year, saw its stock price jump by 7.27%, recovering from a 6.41% decline earlier in January. Crafton, a game company that recently surpassed Kakao in market capitalization, also enjoyed a 6.12% boost in its stock price.
the Deep Chic phenomenon, characterized by its low cost and high efficiency, is expected to have a ripple effect on domestic AI software-related companies. Historically, the domestic internet and game industries have struggled to make large-scale investments in high-performance AI. Though, with Deep Chic demonstrating the ability to implement advanced AI models at a fraction of the cost of big tech companies, analysts predict a potential shift in the landscape.Choi Seung-ho, a researcher at the Securities Research Institute, noted, “If an advanced AI is applied to the game, it will be attractive and increase the number of users and users.” This sentiment reflects the growing optimism surrounding the integration of AI technologies in various sectors.Financial stocks also saw a notable rise, benefiting from the Deep Shock effect.As the semiconductor sector,which holds a significant share of the domestic stock market,experienced volatility,investors shifted their focus to the financial sector,driving up stock prices.
Key Stock Performance Summary
| Company | Stock Price Change | Sector |
|—————|————————|——————–|
| Naver | +6.13% | Internet/software |
| Kakao | +7.27% | Internet/Software |
| Crafton | +6.12% | Gaming |
| Financials | Significant Rise | Banking/Insurance |
The Deep Chic wave has not only reshaped investor sentiment but also highlighted the potential for cost-effective AI solutions to drive innovation and growth in domestic industries.As the market continues to adapt to this new reality, the focus will remain on how companies leverage these advancements to stay competitive in an increasingly AI-driven world.The South Korean financial sector is witnessing a remarkable turnaround,with key players like Samsung Fire & Marine Insurance and Samsung Life leading the charge. After a challenging start to the year, these companies have posted significant gains, signaling renewed investor confidence.
A Strong Recovery for Samsung Fire & Marine Insurance
Samsung Fire, a leader in the non-life insurance sector, reported an notable 11.71% increase in its corporate value plan. This surge comes after a 4.74% decline earlier this month, effectively erasing all losses incurred this year.The company’s recovery has been bolstered by foreign investors, who purchased W17 billion worth of shares, highlighting its growing appeal in the market.
samsung Life’s Remarkable Surge
Similarly, samsung Life, which saw a 14.35% decline in January, surged by 9.73% as of January 24. This rebound underscores the resilience of the insurance giant and its ability to adapt to market fluctuations.
Financial Holdings and Securities Firms on the Rise
The four major financial holdings—KB Financial Group, Shinhan Holdings, Hana Financial Group, and Woori Financial Group—also experienced notable gains. Additionally, major securities firms like Mirae Asset Securities (2.55%) and Samsung Securities (2.13%) closed on a positive note.
Foreign investors played a pivotal role in this upward trend, injecting significant capital into these companies. For instance, KB Financial Group saw W31 billion in foreign investments, while Shinhan Holdings, hana Financial Group, and Woori Financial Group attracted W17 billion, W10 billion, and W8 billion, respectively. Mirae Asset Securities and Samsung Securities also benefited, with investments of W1 billion and W3 billion.
Dividend Payouts Fueling Investor Interest
The demand for dividend payments has further fueled investor interest. KB Financial Group announced it would disclose its dividend date after late January, while Shinhan Holdings and Woori Financial Group plan to decide on payouts by mid-February. Samsung Fire is also set to finalize its dividend payouts after its regular shareholders’ meeting, following its commitment to expand its shareholdership rate to 50% within three years.
Expert Insights
Ahn Young-joon, a researcher at Kiwoom Securities, noted, “It is a situation where financial stocks are in the spotlight as the defence stocks are attracting attention due to the sluggish domestic stock market.” This observation highlights the shifting dynamics in the market, with financial stocks emerging as a safe haven for investors.
Key Highlights at a Glance
| Company | Performance | Foreign Investment |
|—————————|————————————-|————————|
| Samsung Fire & Marine Insurance | 11.71% increase in corporate value | W17 billion |
| Samsung Life | 9.73% surge | – |
| KB Financial Group | Positive growth | W31 billion |
| shinhan Holdings | Positive growth | W17 billion |
| Hana Financial Group | positive growth | W10 billion |
| Woori Financial Group | Positive growth | W8 billion |
| Mirae Asset Securities | 2.55% increase | W1 billion |
| Samsung Securities | 2.13% increase | W3 billion |
The resurgence of South Korea’s financial sector is a testament to the resilience of its key players. With foreign investments pouring in and dividend payouts on the horizon, the future looks promising for these companies. As the market continues to evolve, financial stocks are poised to remain a focal point for investors seeking stability and growth.
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