Index bundle

The following basket contains three indices which demonstrate growth of global economy. Moreover, NKY and KOSPI are main indicators of world technology demand. We expect that demand for chips, components and electronics would stay strong. In addition, SX7E which demonstrated growth even during tight monetary policy would continue to show the increase as EU banks demonstrate robust results and prove strength of the local financial system.

The Korea Composite Stock Price Index (KOSPI) is the representative stock market index of South Korea that includes more than 800 companies in the index. Generally, KOSPI contains large, mature, industrial, and blue-chip corporations. Additionally, KOSPI works as a main indicator for global investors as top companies of the index export memory chips around the globe hence investors judge global demand on technology. It should be noted that around 50% of the index are two companies Samsung Electronics and SK Hynix.

Since the beginning of the year index demonstrated 65% increase though this includes the reach of all time high in June and sharp decrease later. With the remaining strong demand on the components and chips strike on the current index level might allow to set comfortable capital barrier level.

EURO STOXX Banks Index is the index that tracks the largest banking stocks in the Eurozone. It is widely used by investors as the definitive benchmark for the financial health of the European banking sector.

For now, there has been only one rate hike in 2026 YTD in Eurozone. The sole increase occurred on June, when the Governing Council raised benchmarks by 25 bps. Even though the index YTD demonstrated 22% increase since the year start. Analysts expect one more rate hike in September and low chance of the additional hike in December. Despite that Banks index demonstrates strong growth. Even during the period of increasing rates in Eurozone (from June 2022 till May 2024) index demonstrated 83% growth for the period.

The Nikkei 225 Index is the leading stock market index for Japan, tracking 225 large, liquid, bluechip companies listed on the Prime Market of the Tokyo Stock Exchange. Technology companies dominate in the index (~25%). These companies include electronics, precision instruments, and communications. The largest companies in the index are Sony, Tokyo Electron, and Advantest.

Since the beginning of the year index demonstrated 37% increase. However recently BoJ increased rates to 1% which confirms that deflation is finally ended and normal economic growth has returned. On the one hand higher rates might lead to stronger Yen pressuring profit margins, on the other hand in the long-run rate hike proves the end of stagnation. Additionally, interest income of the local financial institutions might increase.

After July’s sell-off, KOSPI gained 11.5% last week and broke a seven-week losing streak as foreign buyers returned, while Korea’s new semiconductor fund adds fresh support to the chip sector. The Nikkei has now risen for five straight sessions, led again by AI and memory names, while European banks remain near fresh highs despite expectations of another ECB hike. At the same time, the chance of a September Fed hike has fallen to around 30%, removing an important global headwind just as momentum is returning across all three legs.