Individual Investors Sell Off Amid Concerns Over Jojeongjang and Short Selling... Markets Fall to 3170 and 990 Levels

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] With the resumption of short selling on May 3 and growing concerns over a market correction, individual investors are showing a selling bias in the KOSPI market. The KOSPI and KOSDAQ, which had each surpassed the 3200 and 1000 marks during the session, are currently hovering around 3170 and 990 levels, respectively, pressured by net selling from individuals.

As of 10:06 a.m. on the 29th, the KOSPI index is at 3,179.66, down 0.06% from the previous trading day.

The KOSPI maintained the 3200 level for two consecutive trading days after reaching it on the 26th but has shown a significant decline since the 27th.

At the same time, the KOSDAQ index is down 0.59% from the previous day, standing at 992.49. Having entered the 'Cheonsdak' (above 1000) on the 12th, the KOSDAQ maintained this level for 12 consecutive trading days but appears to be slowing down due to the short selling issue.

With the resumption of short selling scheduled for May 3, limited to the constituent stocks of the KOSPI 200 and KOSDAQ 150 indices, the market appears to be significantly contracting. Although the U.S. Federal Reserve, the central bank, has maintained an accommodative monetary policy by keeping the benchmark interest rate at 0.00?0.25%, it seems insufficient to drive the market upward.

Currently, individual investors are selling stocks worth 122.8 billion KRW in the KOSPI market. Foreigners and institutions are net buyers, purchasing 31.7 billion KRW and 120.2 billion KRW, respectively.

Most sectors are showing gains, with steel and metals, distribution, and chemicals rising about 1%.

In the KOSDAQ market, individuals are buying stocks worth 26 billion KRW. Foreign investors are also net buyers at 11.4 billion KRW, while institutions are the sole net sellers at 30.9 billion KRW.

Most sectors are declining, with paper/wood falling sharply by over 2%. Metals and computer services are the only sectors showing gains at 0.63% and 1.69%, respectively.

Jeong In-ji, a researcher at Yuanta Securities, stated, "After the KOSPI attempted to break through the 3200 level on the 20th and went through a short-term correction before rising again, the advance was limited around the 3220 level. The previous high range from January, between 3200 and 3260, is expected to be a very strong resistance zone, so it is natural that the price could not surpass this resistance."

He added, "The market is likely to continue moving without a clear direction for the time being. However, if a correction phase proceeds, levels around 3150 or 3100 will serve as important short-term support. Ultimately, a mid- to long-term correction phase can be confirmed only if the index falls below the 60-day moving average and this moving average acts as resistance."

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