[KOSPI 3000] A New Milestone in 38 Years... A Path Never Taken Before

Breaking 3,000 for the First Time Intraday
KOSPI Market Cap 600 Times Since Inception
Donghak Ants, Key Players Against Foreigners
Samsung Electronics Shines as Leading Stock

The KOSPI surpassed the 3,000 mark for the first time in history. On the 6th, the KOSPI index opened at 2,993.34, up 2.77 points (0.09%) from the previous trading day (2,990.57), and broke through the 3,000-point level during the session. This is the first time in about 13 years and 5 months since the KOSPI first crossed 2,000 on July 25, 2007. The photo shows the Hana Bank dealing room in Jung-gu, Seoul on that day (multiple exposure). Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Song Hwajeong] The KOSPI has entered the 3000 era. It has been 38 years since the launch of KOSPI and 14 years since it surpassed the 2000 mark. The market capitalization of KOSPI, which was only 3.049 trillion won at its inception, has grown nearly 600 times to 2080 trillion won. Powered by the strength of Donghak ants, KOSPI quickly recovered from the crash caused by the novel coronavirus disease (COVID-19) last year and continued its record-breaking rally, eventually surpassing the 3000 mark.

As of 9:05 a.m. on the 6th, KOSPI recorded 3024.62, up 34.05 points (1.14%) from the previous day. KOSPI maintained a strong rally for eight consecutive trading days, setting new all-time highs seven times during this period. After closing last year at 2873.47 and rising to the 2870 level, KOSPI reached the 2900 level on the first day of this year and continued its unstoppable bull run, surpassing the 2990 level the day before.

KOSPI has shown a dramatic trend since last year. Starting at 2175.17 last year, KOSPI rose to the 2260 level early in the year, showing a decent trend, but plunged to 1457.64 in March due to the unexpected variable of COVID-19. Afterwards, individual investors actively bought undervalued large-cap blue-chip stocks, and the index recovered to the 1900 level within a month. KOSPI recovered to the 2000 level in May, and although the pace of increase slowed after August, foreign investors returned in November, continuously setting new all-time highs and maintaining an unstoppable upward trend to the 3000 level. KOSPI rose more than 30% last year alone and surged over 97% from its yearly low.

The main protagonist of the KOSPI 3000 era is undoubtedly the Donghak ants. Last year, individual investors defended the index by net buying against foreign selling during the COVID-19 crash, leading to the term "Donghak Ant Movement," likening it to the Donghak Peasant Movement resisting foreign forces. Last year, individuals net purchased 47.4907 trillion won in KOSPI. During the same period, foreigners sold 24.5652 trillion won, and institutions sold 25.5373 trillion won. Even this year, individuals have led the breakthrough of the 3000 mark by purchasing more than 1.7 trillion won as of the day before.

Another key player is Samsung Electronics. Samsung Electronics also played a leading role as the top stock, continuously setting new all-time highs and driving KOSPI’s record-breaking rally. On this day, in line with the arrival of the KOSPI 3000 era, Samsung Electronics rose intraday to 84,500 won, setting a new all-time high again. Samsung Electronics rose more than 45% last year alone.

Along with the unstoppable rally, money moves into the stock market are accelerating. While funds have withdrawn from bank savings and time deposits where money is locked, demand deposits, which are cash-equivalent assets allowing frequent withdrawals and deposits, have shown a sharp increase. The balance of demand deposits at the five major banks at the end of last month was 582.168 trillion won, up 16.0568 trillion won from 566.1113 trillion won in November. Following an increase of 16.383 trillion won in November, this marks two consecutive months of over 16 trillion won growth. Investor deposits, which are standby funds for the stock market, also exceeded 68.28 trillion won as of the 4th, setting a record high.

However, concerns about a bubble exist due to the rapid rise in the stock market. Jeong Yongtaek, head of research at IBK Investment & Securities, said, "Considering market capitalization relative to gross domestic product (GDP), the stock price is about 10 to 15% overshooting the economic fundamentals, so it will not be easy for KOSPI to settle at the 3000 level." He added, "We need to closely monitor the pandemic trend of COVID-19, the movements of the U.S. market after the inauguration of the Joe Biden administration, and the possibility of domestic corporate credit tightening this spring."

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