25-Year-Old Kosdaq Hits Intraday Record High Fanfare

KOSDAQ Intraday Record High
Leading Stocks in Market Cap Rise
Expecting Upward Trend in Second Half

[Asia Economy reporters Junho Hwang and Byungseon Gong] The KOSDAQ has surpassed its all-time high since the benchmark index change. Following the KOSPI breaking through its record high of 3300 last month, the KOSDAQ has joined the streak of record-breaking highs. The securities industry forecasts that the long-overlooked KOSDAQ could shine in the second half of this year.

On the 1st, the KOSDAQ soared to 1032.69 at 9:07 a.m., marking its highest level this year. Individual investors have been net buyers of over 100 billion KRW until 11 a.m., driving the market upward. This year, the KOSDAQ index surpassed the benchmark of 1000 for the first time in about 20 years since the 'dot-com bubble' and is setting new highs again today. As of 1:46 p.m., the KOSDAQ stands at 1035.86.

The KOSDAQ started at a benchmark index of 100 on this day in 1996, but after the collapse of the 'dot-com bubble,' the index failed to rise above double digits. Therefore, in January 2004, the benchmark index was multiplied by 10 and reset to 1000. The number of listed companies, which was 341 at launch, has increased to 1506 as of June this year.

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 Hyunmin kimhyun81@

The main drivers of the KOSDAQ's rise today were the top market capitalization stocks. Pearl Abyss recorded a 14.0% increase to 86,300 KRW in the morning and is currently trading at 82,200 KRW, up 8.595%, this afternoon. Pearl Abyss's stock surged following news that the game license for its mobile game 'Black Desert Mobile' was successfully issued for service in China.

Seegene, known for its COVID-19 diagnostic kits, rose on news of a partnership with a global bio-diagnostics company to enter the U.S. market in earnest. As of this time, it is trading at 85,700 KRW, up 3.63%. Additionally, Celltrion Pharm (2.61%), EcoPro BM (1.60%), and CJ ENM (0.49%) are also showing upward trends.

After retreating to 500 following the COVID-19 outbreak last year, the KOSDAQ has now surged to its highest point, indicating it has overcome the aftershocks of the pandemic. There are even forecasts suggesting a need to focus on the KOSDAQ in the second half of this year.

Looking at the relative returns of the KOSPI and KOSDAQ, the KOSDAQ has lagged significantly. The relative return has reached about -20% from its past peak. Excluding the period around the dot-com bubble, the relative return between KOSPI and KOSDAQ has fallen below -20% three times (2006, 2010?2011, 2017). Of these three times, twice (2006, 2017) the KOSDAQ outperformed after the bottom.

Lee Euntaek, an equity research analyst at KB Securities, stated, "This time, due to fundamentals and supply-demand factors, the KOSDAQ is judged to have a higher potential for growth." He added, "Exports in South Korea are expected to slow down in the second half, during which the KOSDAQ is likely to outperform the KOSPI." He also anticipated benefits for large KOSDAQ stocks from government policies such as strengthening K-battery competitiveness. He expects the supply-demand burden on the KOSDAQ to ease in the second half as non-arbitrage net selling comes to an end.

He particularly predicted an upward trend for gaming and biotech sectors. In gaming, new releases by individual developers were delayed due to COVID-19, weakening earnings momentum. However, in the second half, releases such as NCSoft's 'Blade & Soul 2' and Netmarble's 'Marvel Future Revolution' are scheduled, and China's market is reopening, bringing positive momentum. The biotech sector is noteworthy as it remains at levels similar to when biotech and the KOSDAQ collapsed in 2019, indicating it is currently undervalued, according to the analyst.

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