KOSPI Repeats Minor Fluctuations Without Clear Direction... Only Individuals Are Shopping

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[Asia Economy Reporter Lee Seon-ae] The KOSPI is showing a pattern of slight fluctuations without establishing a clear upward or downward trend.

As of 1:16 PM on the 22nd, the KOSPI is at 3041.78, up 0.07% from the previous trading day. The KOSDAQ remains at 955.93, up 0.40%. The KOSPI opened at 3040.01, up 0.48 points from the previous day, and the KOSDAQ started at 953.04, up 0.93 points. Throughout the afternoon, only minor fluctuations have occurred without any clear directional movement.

The mixed closing of the U.S. stock market influenced this trend. On the 19th (local time), the New York stock market closed mixed.

The Dow Jones Industrial Average fell 0.71%, and the Standard & Poor's (S&P) 500 index dropped 0.06%. The Nasdaq index, which is tech-heavy, closed up 0.76%. Despite the U.S. Federal Reserve's (Fed) reaffirmation of its low interest rate policy, unease in the bond market persisted. The 10-year Treasury yield even surged to 1.75% during the session.

Seosangyoung, a researcher at Kiwoom Securities, explained, "The Fed has decided to end the Supplementary Leverage Ratio (SLR) relief measure, which excludes Treasury bonds and reserves from banks' required capital calculations, as scheduled at the end of this month. This means banks may have to sell Treasury bonds due to increased costs of holding them, potentially accelerating the rise in interest rates."

Institutions and foreigners are selling simultaneously, while individual investors are buying alone, resulting in a tug-of-war. Individuals are net buyers of 427.4 billion KRW and 100.1 billion KRW in the KOSPI and KOSDAQ markets, respectively. Conversely, institutions are net sellers of 51.6 billion KRW and 18.1 billion KRW in the KOSPI market. Foreigners are also selling 378.1 billion KRW and 84.8 billion KRW in both markets, respectively.

Looking at the KOSPI sector status, the machinery sector (+2.36%) shows notable gains, along with transportation and warehousing (+0.70%) and chemicals (+0.59%). On the other hand, sectors such as paper and wood (-0.69%) and electricity and gas (-0.46%) are declining.

In the KOSDAQ sector, the other services sector (+2.37%) stands out with gains, followed by entertainment and culture (+1.45%) and distribution (+0.45%). Meanwhile, mining (0.00%) and lodging and food services (-0.95%) sectors are declining.

Han Ji-young and Chae Hyun-gi, researchers at Cape Investment & Securities, stated, "The KOSPI is still unable to establish a clear direction and is only generating volatility. The upward factor is the market's reduced sensitivity to rising interest rates, while the downward factor is the possibility of further market interest rate increases due to the Fed's insufficient crisis management."

However, they added, "The current rise in interest rates causing market anxiety is a temporary concern, and the 1.7% level on the U.S. 10-year Treasury yield is likely a short-term peak. This suggests that market sensitivity to interest rates will decrease toward the end of the month, so it is advisable to refrain from selling at this point."

Seo Jeong-hoon, a researcher at Samsung Securities, emphasized, "The difficulty in responding to the current market is due to the absence of clear earnings improvement. However, survey-based macro indicators (e.g., PMI) are showing unprecedented upward momentum."

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