All three telecommunication companies, including SKT, reported
Naver and Kakao are also strong at around 3%
AI business booming with no impact from tariffs
Next year’s performance forecast is also revised upward.
Securities market: “Maintain moderate growth”
On the morning of the 27th, stock prices are displayed on the status board in the dealing room of Hana Bank’s main branch in Jung-gu, Seoul. As of 9:02 am on this day, the KOSPI index stood at 2517.51, down 2.85 points (0.11%) from the previous trading day. Yonhap News
The stock prices of telecommunications and internet stocks that have avoided the ‘Trump risk’ are showing strong performance. While major domestic industries such as semiconductors and secondary batteries are shaken by uncertainty about the policies of U.S. President-elect Donald Trump, expectations are growing that a ‘Santa rally’ will occur at the end of the year in telecommunications and internet stocks. In particular, the fact that next year’s performance forecasts for these industries are being revised upward is also acting as a positive factor.
According to the Korea Exchange on the 27th, SK Telecom (017670) closed trading at 61,000 won, up 2,700 won (4.63%) from the previous day. KT (030200) and LG U+ (032640) also rose 4.62% and 2.58%, respectively. On this day, all three telecommunication companies broke their 52-week intraday record highs.
Internet stocks were also clearly strong, with NAVER (035420) and Kakao (035720) rising 3.78% and 3.65%, respectively.
Recently, the telecommunications and internet industries have been steadily rising while avoiding direct risks, unlike the manufacturing industry, which is immediately affected by Trump’s policies. From the 6th of this month, after the actual presidential election, to this day, ‘KRX Broadcasting and Communication’, which consists of 7 stocks including KT, SK Telecom, and LG U+, and the themed index ‘KRX Internet Top 10’ rose 7.93% and 12.08%, respectively. It stands out when compared to the KOSPI, which fell 2.86% during the same period.
This upward movement in telecommunications and internet stocks is analyzed to be due to the fact that they are service industries unrelated to the introduction of tariffs. In particular, expectations are growing that substantial business results will be seen in the artificial intelligence (AI) field, where investment has been expanded so far.
In the case of the three telecommunications companies, the AI infrastructure business is expected to become a new growth engine. This is because the demand for data centers has rapidly increased due to the rise of generative AI, and telecommunication companies that have secured infrastructure in advance are expected to benefit. Kim Jun-seop, a researcher at KB Securities, said, “Telecommunication companies’ AI infrastructure business will serve as stock price momentum in 2025,” and “It will be able to compensate for the slowdown in sales growth of wired and wireless communications.”
The fact that Internet industry stock prices were extremely undervalued also had a positive effect. This year, Naver and Kakao’s stock prices fell by more than 9% and 29% as market concerns about their growth potential grew. Accordingly, the company is focusing on strengthening profitability and seeking external growth centered on advertising and commerce businesses. In particular, in the commerce field, we are focusing on monetization through AI technology.
The securities company explains that as the outlook for next year’s performance in the telecommunications and internet industries is bright, there is not much negative news that will drag down stock prices for the time being. In fact, performance forecasts for related stocks are rising one after another. According to FnGuide, as of the 26th, at least three securities companies raised their forecast for KT’s operating profit next year by 37.1% compared to the 6th of this month. SK Telecom rose 6.3% and LG U+ rose 4.6%. In particular, there is a high possibility that the three telecommunications companies will be included in the Korea Value Up Index on the 20th of next month. Stock prices are expected to show a solid trend for the time being.
Likewise, Naver and Kakao’s operating profit forecasts for next year are also bright. Performance forecasts have recently risen by 17.3% and 19.2%, respectively, compared to previous estimates. Jeong Eui-hoon, a researcher at Eugene Investment & Securities, explained, “Although internet stocks are growth stocks, their stock prices have fallen excessively due to concerns about losing growth potential,” adding, “Starting in the second half of this year, a rebound has been seen as the industry has recovered.” He then predicted, “As it is not an industry that is disadvantaged or benefited from Trump’s election, it will maintain a moderate growth rate next year.”
**Paa:** What are the potential risks for investors who are entering the telecom and internet market now, considering the article mentions concerns about growth potential for companies like Naver and Kakao?
## World Today News: Telecom and Internet Stocks Defy “Trump Risk” – A Market Analysis
Welcome to World Today News. Today, we’re diving into the booming performance of Telecom and Internet stocks in the face of global economic uncertainty.
Joining us are two esteemed guests:
* **Mr. Park Jin-woo:** A seasoned financial analyst with years of experience observing the Korean stock market.
* **Ms. Lee Soo-hyun:** A tech industry specialist with a deep understanding of the AI landscape and its implications for businesses.
Let’s begin our discussion.
**Part 1: The Tech Industry’s Resilience**
* **Mr. Park,** the article highlights that telecom and internet stocks have been remarkably resilient in the wake of the US presidential election, defying the dip experienced by other sectors. What factors contribute to this resilience, and do you foresee this trend continuing?
* **Ms. Lee,** the article mentions AI as a key driver for future growth in these sectors. Could you elaborate on the specific ways AI is transforming the telecom and internet industries, and what are some potential risks and challenges associated with this rapid adoption?
**Part 2: Investing in Uncertainty**
* **Mr. Park,** the article notes that internet stocks like Naver and Kakao, despite facing market concerns about growth potential, remain attractive to investors. What aspects of these companies make them appealing investment opportunities, even in uncertain economic times?
* **Ms. Lee,** we often hear about the potential of “disruptive technologies.” In the context of AI, how do you see this impacting traditional telecom and internet businesses? Will some companies thrive, while others struggle to adapt?
**Part 3: Looking Ahead: The “Santa Rally” and Beyond**
* **Mr. Park,** many analysts predict a “Santa rally” for telecom and internet stocks. What are the key indicators you are watching to confirm or refute this prediction?
* **Ms. Lee,** if the performance forecast for these industries continues to be revised upwards, what broader implications could this have on the Korean economy and global tech landscape?
**Closing Thoughts:**
We thank our esteemed guests, Mr. Park and Ms. Lee, for their insightful analysis.
To our viewers, we hope this discussion sheds light on the dynamic forces shaping the telecom and internet landscape. As these industries continue to evolve, World Today News will remain committed to providing in-depth coverage of the trends and issues that matter most.
