The head of the Korea Exchange predicts a significant milestone for the national stock market. CEO Jeong Eun-bo stated the Kospi has strong potential to surpass 6,000 points. Consequently, achieving this level would signal the arrival of a Korea premium. He made these comments during a Thursday press conference in Seoul. Moreover, he outlined ambitious plans to extend daily trading hours. These steps aim to boost the market’s global competitiveness and valuation.
Currently, the Kospi index demonstrates a powerful historic rally. Its value has nearly doubled from just one year earlier. Jeong expects the benchmark to climb past 6,000 without major disruptions. Such a rise would align valuations with other developed economies. Specifically, the price-to-book ratio would reach about 2.23. This figure matches the average for major developed markets internationally. Therefore, achieving a Korea premium would mark a major financial re-rating.
Presently, Korean equity valuations remain relatively low globally. The combined price-to-book ratio sits around 1.9 currently. By comparison, major European markets average approximately 2.3. Furthermore, the United States maintains a much higher ratio near 5.0. International analysts like JPMorgan suggest even higher targets. They present an upside scenario of 7,500 for the Kospi. Jeong noted that exceeding that could indicate a premium valuation. Ultimately, this reflects growing international confidence.
Concurrently, the exchange operator plans a major operational overhaul. It will introduce a 24-hour trading system by December 2027. The first step extends hours starting June 29 this year. New premarket and after-hours sessions will lengthen daily trading. This move responds directly to intensifying global competition. Major exchanges like NYSE and Nasdaq plan round-the-clock trading. Jeong stressed that extending hours is now unavoidable. The goal is ensuring a level playing field for Asian investors.
Additionally, Jeong highlighted a serious risk of inaction. Korea could lose vital global liquidity without longer hours. Foreign investors dominate after-hours trading on other exchanges. Notably, Korean investors represent a substantial portion of this activity. Over forty percent of Nasdaq’s after-hours trades involved Koreans. The local market already possesses strong global integration. Foreign investors account for more than thirty-six percent of activity. Thus, the market is truly global in scale and participation.
In conclusion, achieving a Korea premium requires both valuation growth and structural change. The forecasted Kospi rise reflects underlying economic strength. Meanwhile, extended trading hours address practical competitive necessities. Together, they could significantly elevate Korea’s financial market status. The coming years will test these interconnected strategic ambitions. Market participants will watch the index level and reform implementation closely. Success could redefine Korea’s role in global finance permanently.
