SSNLF - EWY: Won Should Improve Hawkishness Helps Financials
2024-04-18 03:28:11 ET
Summary
- iShares MSCI South Korea ETF provides exposure to Korean markets, with a focus on semiconductors dominated by Samsung.
- DRAM prices are increasing, benefiting Samsung and SK Hynix, even though we are worried about the ongoing glut in semiconductors and general demand.
- Hawkish policies benefit financials right now, and strong exports due to a still weak Won benefit consumer discretionary exposures like automotive.
- Appreciation in the Won will be a net positive for this ETF due to imported inflation effects, and is welcome when the Fed eventually lowers US rates.
- With quite a low PE, we think there's upside due to corporate governance reform incoming in Korea.
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EWY: Won Should Improve, Hawkishness Helps Financials