Domestic Stock Market Turns Pale with Pandemic Declaration... KOSPI Closes Down 3.9%

[Asia Economy Reporter Minji Lee] The domestic stock market was deeply shaken by the World Health Organization (WHO)'s pandemic declaration. On the 12th, the KOSPI and KOSDAQ indices plunged sharply due to the impact of the novel coronavirus infection (COVID-19).

On the 12th, the KOSPI closed at 1,834.33, down 73.94 points (3.87%). The KOSPI started the day at 1,887.97, down 20.30 points (1.06%) from the previous session, and recorded a decline of over 5% during the trading session.

In the market, foreigners alone sold stocks worth 885.3 billion KRW. Institutions and individuals bought stocks worth 285.4 billion KRW and 553.2 billion KRW, respectively.

During the session, a sidecar was triggered in the securities market. The Korea Exchange announced that at 1:04:37 PM, due to a drop in futures prices, program sell orders in the securities market would be temporarily suspended for 5 minutes (sidecar activation).

This was the first time in about 8 years and 5 months that a sell-side sidecar was triggered in the securities market since concerns over Greece's debt default (default) increased on October 4, 2011.

The securities market sidecar is triggered when the price of the most actively traded stock among KOSPI 200 futures contracts rises or falls by more than 5% for one minute, and it is automatically lifted after 5 minutes from the activation time.

By sector in the securities market, the lowest decline rates were in pharmaceuticals (-2.67%), transportation and warehousing (-3.40%), electric and gas utilities (-3.51%), and electrical and electronics (-3.51%).

Samsung Electronics, the largest market cap stock, closed at 50,800 KRW, down 2.5% from the previous session. Most other stocks also fell, including SK Hynix (-3.16%), Samsung Biologics (-0.21%), and Naver (-2.06%).

Researcher Jiyoon Kim from Daishin Securities explained, “The absence of a large-scale stimulus policy announcement in President Trump's speech acted as a negative factor for the stock market,” adding, “Asian markets also fell sharply following the COVID-19 pandemic declaration.”

At the same time, the KOSDAQ index closed at 563.49, down 32.12 points (5.39%) from the previous session. The KOSDAQ started at 589.20, down 1.08% (6.41 points), and continued to widen its losses throughout the session.

By sector, the lowest decline rates were in transportation equipment and parts (-2.78%), textiles and apparel (-3.27%), distribution (-3.37%), and pharmaceuticals (-3.94%).

Among the top market cap stocks, only HL Biotech closed higher at 85,200 KRW, up 2.65% from the previous session. Celltrion Healthcare (-0.3%), CJ ENM (-7.05%), Pearl Abyss (-5.07%), and Studio Dragon (-5.94%) all declined.

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