Individuals Bought Over 1 Trillion Despite 'Sense of Caution'... "1% Drop in a Day"

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] On the 19th, the domestic stock market, which started off lower, continued its weak trend and ended a tedious bearish market. Foreigners and institutions sold throughout the day, and individual investors absorbed these sales, but it was insufficient to create upward momentum in the market. Investment sentiment is extremely subdued due to the spread of inflationary pressures and concerns over the resurgence of COVID-19.

On that day, the KOSPI opened at 3,258.87, down 18.04 points (0.55%↓), hovered around the 3,240 level, and closed at 3,244.04, down 32.87 points (1.00%↓). The KOSDAQ also started at 1,049.51, down 2.47 points (0.23%↓), continued its weak trend, and closed at 1,049.83, down 2.15 points (0.20%↓).

Foreigners and institutions continued to show a net selling bias. Foreigners net sold 458 billion KRW and 34.9 billion KRW in the KOSPI and KOSDAQ markets, respectively. Institutions also sold 458.5 billion KRW and 56.7 billion KRW, respectively. Only individuals were net buyers. Individuals purchased 938.5 billion KRW in the KOSPI market alone and net bought about 106.8 billion KRW in the KOSDAQ market.

Seo Sang-young, a researcher at Mirae Asset Securities, said, "The U.S. stock market declined due to weak consumer sentiment despite solid retail sales, the weakness of cyclical stocks caused by the Delta variant, and the Philadelphia index falling more than 2% daily last week, which burdened the domestic stock market."

By sector in the KOSPI, most sectors closed lower, including Medical Precision (-2.47%), Steel and Metals (-2.32%), and Finance (-1.49%), while only a few sectors such as Electric and Gas (+1.37%), Telecommunications (+1.07%), and Non-metallic Minerals (+0.01%) showed strength.

By sector in the KOSDAQ, most sectors closed lower, including Construction (-2.32%), Broadcasting Services (-2.29%), and Paper and Wood (-2.01%), while only a few sectors such as General Electric and Electronics (+2.80%), Chemicals (+1.61%), and IT Components (+0.49%) showed strength.

Kim Dae-jun, a researcher at Korea Investment & Securities, analyzed, "The Delta variant of COVID-19, which is spreading domestically and internationally, is acting as a variable weakening the upward momentum of the index." He added, "In designing future response strategies, it is necessary to select sectors and stocks based on profits. Currently, sectors with upward revisions in earnings forecasts compared to the previous month include energy, materials, industrials, consumer discretionary, and IT, which are cyclical sectors. In periods where the index is likely to move sideways in the short term, focusing on sectors with increasing earnings, as mentioned above, can be a favorable strategy to maintain returns."

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