Despite Foreign Selling Pressure, KOSPI Recovers to 3150 Level... Is Rebound Buying Coming In?

Institutions Show Buying Power Exceeding 280 Billion Won
KOSDAQ, Which Fell Below 1000 During Trading, Rises to 1018 Level

[Asia Economy Reporter Gong Byung-sun] Despite strong selling pressure from foreigners, the KOSPI showed a firm tone, recovering the 3150 level. Although there were concerns that the spread of the COVID-19 Delta variant could slow the economic recovery, it appears that rebound buying has come in response to the recent continuous decline.

As of 11:03 a.m. on the 18th, the KOSPI recorded 3150.24, up 0.23% (7.15 points) from the previous trading day. It even rose to 3157.50 at 10:17 a.m. that day.

The U.S. stock market's decline due to concerns over a slowdown in economic recovery seemed to have a negative impact in the early session. With the spread of the COVID-19 Delta variant, U.S. retail sales in July decreased by 1.1% compared to the previous month. Accordingly, the Dow Jones Industrial Average closed at 35,343.28, down 0.79% (282.12 points) from the previous trading day. The S&P 500 index fell 0.71% (31.63 points) to 4,448.08, and the Nasdaq closed down 0.93% (137.58 points) at 14,656.18.

However, the U.S. industrial production sector is recovering, indicating that the economic contraction is not clearly evident. Seo Sang-young, a researcher at Mirae Asset Securities, explained, "U.S. industrial production in July increased by 0.9% compared to the previous month, showing continuous improvement," and added, "Since the domestic stock market experienced a larger decline than other countries last week, rebound buying is expected to flow into the domestic market."

Institutional investors showed strong buying. Institutions net purchased 286.7 billion KRW. Individuals bought 17.6 billion KRW. On the other hand, foreigners net sold 307.1 billion KRW.

Almost all sectors rose. The textile and apparel sector had the largest increase at 3.49%. This was followed by banks (2.23%), transportation and warehousing (1.95%), telecommunications (1.42%), and paper and wood products (1.31%). On the downside were insurance (-1.33%), pharmaceuticals (-0.27%), steel and metals (-0.12%), and electrical and electronics (-0.03%).

Many of the top 10 market capitalization stocks showed weakness. Samsung Biologics had the largest drop at 1.78%. This was followed by Hyundai Motor (-0.94%), Samsung SDI (-0.76%), LG Chem (-0.67%), Samsung Electronics (-0.54%), and NAVER (-0.23%). Meanwhile, KakaoBank (2.86%), SK Hynix (1.97%), Kakao (1.41%), and Celltrion (0.55%) rose.

At the same time, the KOSDAQ index rose 0.44% (4.45 points) from the previous trading day to 1015.50. Early in the session, it fell to 999.26, dipping below the 1000 mark during the day. This was the first time it fell below 1000 in about two months since June 17. However, it turned upward from 9:41 a.m. and rose to as high as 1018.45.

Buying by foreigners and institutions led to the index's rise. Foreigners and institutions net purchased 72.9 billion KRW and 2.9 billion KRW, respectively. Individuals net sold 80.2 billion KRW.

Almost all sectors rose. The transportation equipment and parts sector had the largest increase at 2.44%. This was followed by paper and wood products (1.50%), non-metallic minerals (1.44%), publishing and media reproduction (1.37%), and metals (1.36%). On the downside were other manufacturing (-2.83%), chemicals (-1.07%), transportation (-0.98%), and internet (-0.36%).

Many of the top 10 market capitalization stocks showed strength. HL B's increase was the largest at 6.46%. This was followed by Pearl Abyss (1.78%), Kakao Games (1.17%), EcoPro BM (0.80%), L&F (0.60%), and CJ ENM (0.53%). CJ ENM re-entered the top 10 market capitalization stocks, pushing out Alteogen. On the downside were SK Materials (-1.56%), Seegene (-0.45%), Celltrion Pharm (-0.24%), and Celltrion Healthcare (-0.08%).

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