Foreigners' record 13 trillion won sell-off... KOSPI plunges 4%, closes below 1950 level

[Asia Economy Reporter Oh Ju-yeon] On the 9th, the domestic KOSPI plunged by over 4%. Foreign investors sold off a staggering 1.3 trillion KRW worth of stocks in a single day, dragging the index down. This marks the largest sell-off in about 9 years.

According to the Korea Exchange on that day, the KOSPI closed at 1,954.77, down 4.19% from the previous trading day. This decline is attributed to concerns over the spread of the novel coronavirus infection (COVID-19) in the US and Europe, the sharp drop in international oil prices, and increased volatility in the global foreign exchange market.

In the securities market, foreign investors and institutions net sold 1.3122 trillion KRW and 40.7 billion KRW respectively, while individuals net bought 1.2744 trillion KRW worth of stocks.

Notably, the foreign investors' sell-off exceeding 1 trillion KRW is the largest daily net sale since August 10, 2011 (1.2759 trillion KRW).

Among the top market capitalization stocks, most experienced significant declines, including Samsung Electronics (-3.89%), SK Hynix (-5.72%), NAVER (-6.13%), LG Chem (-6.00%), Hyundai Motor (-4.98%), and Samsung SDI (-6.16%). Only Samsung Biologics closed higher, rising 0.41% to 493,000 KRW.

The KOSDAQ index barely maintained the 610 level, closing down 4.38% at 614.60 compared to the previous trading day.

Individuals purchased stocks worth 215.5 billion KRW, while foreign investors and institutions sold 139.3 billion KRW and 59.9 billion KRW respectively.

Lee Kyung-min, a researcher at Daishin Securities, diagnosed, "Amid growing COVID-19 fears, the rapid decline in oil prices is shocking the global financial markets. The uncertainty in both demand and supply sides of oil is acting in a complex manner, making the global financial market appear most vulnerable. Therefore, it is difficult to discuss a short-term bottom or rebound."

He added, "However, the primary cause of the oil price decline, COVID-19, is spreading fears outside China, but the Chinese economy is progressing toward normalization. The Federal Reserve's emergency rate cuts and other policy responses are expected to strengthen, which will be a key variable in the 2020 global financial markets."

This content was produced with the assistance of AI translation services.