KOSPI Surpasses 3300... "Will Continue to Rise Gradually"

Deposit Turnover Rate Records 51.37%
Surpasses 50%, Enters Full Overheating Zone
Investors' 'Profit-Taking Desire' Grows
Fear Index Drops to Yearly Low
Market View Dominated by "Stable Rise"

[Asia Economy Reporter Junho Hwang] As the KOSPI soared to an all-time high, overheating indicators in the stock market rapidly intensified. On the other hand, the fear index, which indicates market volatility over the next 30 days, dropped to its lowest level of the year. Securities firms analyzed that the KOSPI is likely to follow a gradual upward curve rather than experiencing sharp rises or falls.

According to the Korea Financial Investment Association on the 28th, as of the 24th, the deposit turnover rate recorded 51.37. This turnover rate is the highest since February 19 (52.69%). The turnover rate is the ratio of the trading volume of KOSPI and KOSDAQ to the deposit funds waiting in the market. Generally, when it exceeds 40%, the market is considered overheated, and when it surpasses 50%, it enters a full overheating zone, signaling that the selling point is approaching.

The turnover rate has risen sharply recently. After recording 39.86% on the 22nd, as the KOSPI reached an all-time high, the turnover rate surged to 50.41% on the 23rd. The market broke the all-time high again on the 24th and closed above the 3300 mark for the first time.

While expectations for the market's all-time high increased, the desire for profit-taking also grew accordingly. Accordingly, on the 25th, when the KOSPI rose to 3300, individual investors who had driven the index's rise sold off about 789.6 billion KRW net. As of 9:30 AM on the 28th, individual investors are net buying 153.7 billion KRW, but institutional and foreign investors are net selling 105.4 billion KRW and 51.5 billion KRW, respectively.

The KOSPI surpassed the 3,300 mark for the first time in history. On the 25th, the KOSPI index opened at 3,289.18, up 3.08 points (0.09%), and extended its gains to break the intraday record of 3,292.27 set the previous day. The photo shows the Hana Bank dealing room in Jung-gu, Seoul on that day. Photo by Kim Hyun-min kimhyun81@

The market consensus is that a stable upward trend will prevail rather than sharp fluctuations. The volatility index (V-KOSPI, fear index), which indicates expected volatility after 30 days, has also fallen to its lowest level of the year, showing a stable trend. V-KOSPI dropped to 14.33 on the 15th, marking the year's lowest, and recorded 14.82 on the 25th, maintaining stability.

The market direction perceived by foreign and institutional investors is divided. On the 25th, the top net sold stock by institutions was the inverse leveraged ETF KODEX 200 Futures Inverse 2× (Gopbeoseu), with 56.44 billion KRW sold. Conversely, foreigners actively purchased Gopbeoseu, buying 24.67 billion KRW. Gopbeoseu is an exchange-traded fund (ETF) that guarantees double returns when the market declines.

With the earnings season starting this week, growing expectations for corporate earnings also contribute to the forecast of a gradual upward curve.

Lee Kyung-min, head of investment strategy at Daishin Securities, said, "As long as the fundamental momentum remains solid, the market direction will trend upward. Although there may be fluctuations due to overheating, short-term anxiety, and supply-demand variables, the KOSPI's upward trend is expected to continue."

Hwang Se-woon, a research fellow at the Korea Capital Market Institute, also stated, "Since corporate earnings in the second quarter are expected to exceed forecasts, the market will show a gradual upward trend. Considering interest rate issues in the second half of the year, it is a time to adopt an investment strategy that anticipates corrections."

On the other hand, Han Ji-young, a researcher at Kiwoom Securities, predicted, "Due to heightened caution over U.S. employment data in the latter part of the week, the market will show a top-heavy pattern, giving back some of the gains."

The KOSPI surpassed the 3,300 mark for the first time in history. On the 25th, the KOSPI index opened at 3,289.18, up 3.08 points (0.09%), and extended its gains to break the intraday record of 3,292.27 set the previous day. The photo shows the Hana Bank dealing room in Jung-gu, Seoul, on that day. Photo by Kim Hyun-min kimhyun81@

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