Foreigners and Institutions Lead Stock Market Rise After a Long Time... Fearful Individuals Sell All Day Amid Boxpi

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] On the 12th, the domestic stock market, which started higher thanks to the sharp rise in the US Nasdaq, is maintaining an increase of around 1% supported by buying from foreigners and institutions. Only individual investors, tired of the 'rollercoaster' market, are net sellers.

As of 1:55 PM on the 12th, the KOSPI is at 3,054.85, up 1.37% from the previous day. It started at 3,030.73, up 0.57% from the previous day, and has been maintaining its gains into the afternoon. The KOSDAQ is at 923.74, up 1.73% from the previous day. It began the session at 910.41, up 0.26%, and has been increasing its gains.

Only individual investors, exhausted by the volatile market, are showing a selling bias. Individuals are net selling 454.4 billion KRW and 67.9 billion KRW in the KOSPI and KOSDAQ markets, respectively. On the other hand, foreigners continue to be net buyers today as well, following yesterday. The Korean stock market showed strong gains yesterday due to foreigners' net buying in both spot and futures on the futures/options expiration day. Currently, foreigners are net buying 268.9 billion KRW in the KOSPI and 93.8 billion KRW in the KOSDAQ markets. Institutions are selling about 17.4 billion KRW in the KOSDAQ market but buying about 186.7 billion KRW in the KOSPI market. The pension funds, which had recorded net selling for 50 consecutive trading days until the previous day, showed signs of switching to net buying on the 51st day but eventually reverted to net selling in the afternoon. As of 1:59 PM, pension funds are net selling 11.6 billion KRW in the KOSPI market and net buying 9.2 billion KRW in the KOSDAQ market. Previously, pension funds had continued a 50-day consecutive 'selling' streak from December 24 of last year until the previous day. During this period, the net selling amount exceeded 14 trillion KRW. However, the industry expects the pension funds' selling trend to continue further. According to the fact that the National Pension Fund's asset management scale has increased by about 6.4 trillion KRW annually on average in recent years, pension funds need to dispose of 26 trillion KRW in domestic stocks this year. Since pension funds have net sold about 14 trillion KRW so far this year, it is calculated that they need to dispose of an additional 12 trillion KRW.

The domestic stock market is expected to continue its volatile trend for the time being. Lee Jae-seon, a researcher at Hana Financial Investment, said, "The domestic stock market is likely to continue a volatile trend ahead of the US March FOMC meeting on the 17th, influenced by major countries' inflation and domestic demand indicators, which act as factors for interest rate direction," adding, "There is no clear sign of a trend improvement in risk asset preference."

Kim Yumi and Kim Jihyun, researchers at Kiwoom Securities, generally said, "The notable event in the financial market is the US FOMC," and added, "The FOMC is expected to reaffirm its stance of maintaining an optimistic view on the economy while minimizing shocks to the financial market by not tightening early. However, since responses to interest rate hikes are also unlikely to come early, market interest rate volatility is expected to remain inevitable for the time being."

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