Concerns Over Delta Variant Weigh on KOSPI at '3220 Level'... Experts Say "Further Decline Is Limited"

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[Asia Economy Reporter Ji-hwan Park] The KOSPI has continued its decline for the third consecutive trading day amid concerns over the spread of the COVID-19 Delta variant, maintaining a downward trend around the '3220 level.' The rapidly spreading Delta variant has raised fears that global economic growth will slow, negatively impacting the domestic stock market following the U.S. stock market. However, experts analyze that since it is unlikely that the world will implement full lockdown policies as it did last year, the additional impact will be limited.

As of 10:12 a.m. on the 20th, the KOSPI stood at 3,229.67, down 0.44% (14.37 points) from the previous trading day. The index started the day at 3,223.24, down 20.80 points (0.64%) from the previous close, and continued its weakness. During the session, it even dropped to 3,214.74 at one point.

Overnight in the New York stock market, major indices such as the Dow Jones Industrial Average (-2.04%), Standard & Poor's (S&P) 500 Index (-1.59%), and Nasdaq Index (-1.06%) experienced significant declines. This is interpreted as investors' growing concerns over the global economic slowdown due to the worldwide spread of the Delta variant.

On this day, individual and foreign investors sold net amounts of 189.6 billion KRW and 75.9 billion KRW, respectively. Institutions bought a net amount of 264.9 billion KRW.

Among the top market capitalization stocks, most declined. Samsung Electronics (-0.63%), SK Hynix (-0.42%), NAVER (-1.24%), Kakao (-1.30%), and LG Chem (-0.98%) all fell. In contrast, Samsung Biologics and Celltrion rose by 0.87% and 2.09%, respectively.

At the same time, the KOSDAQ index stood at 1,046.30, down 0.34% (3.53 points) from the previous trading day. The index started at 1,049.51, down 8.84 points (0.84%) from the previous close, and continued its downward trend.

By investor type, individuals and institutions sold net amounts of 6.5 billion KRW and 37.1 billion KRW, respectively. Foreign investors bought a net amount of 53.9 billion KRW.

Among the top market capitalization stocks, performances were mixed. Celltrion Healthcare rose 4.01% to 116,800 KRW compared to the previous day. Kakao Games (0.59%) and Celltrion Pharm (2.36%) also increased. Conversely, EcoPro BM (-5.32%) and CJ ENM (-0.46%) declined.

However, experts generally believe that the impact of the Delta variant spread on the stock market will be temporary. Sang-young Seo, a researcher at Mirae Asset Securities, said, "Even if COVID-19 resurges, unlike during the pandemic last year, the likelihood of a full economic lockdown is low. Also, the sharp drop in international oil prices was due to some supply-demand factors related to futures expiration, causing excessive volatility. Considering these factors, the decline in the domestic stock market will be limited," adding, "After starting with a decline of around 1%, the drop is expected to narrow amid expectations for the earnings season."

Researcher Sang-hyun Park of Hi Investment & Securities also stated, "Given the limited credit risk caused by the Delta variant virus, the negative impact on the economy and financial markets will also be limited," and added, "Investors seem to believe that the resurgence of the variant virus will only slightly delay the timing of economic normalization and will not have a significant adverse effect on the economic recovery cycle."

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