Tapering and Concerns Over China's Liquidity Reduction... KOSPI Trades Around 3070

KOSPI Down 0.7% · KOSDAQ Index Down 1.4% Range

[Image source=Yonhap News]

[Asia Economy Reporter Minji Lee] The KOSPI is showing a sharp decline amid concerns that early tapering (reduction of asset purchases) from the U.S. and liquidity tightening by the Chinese government may become a reality.

As of 1:19 PM on the 20th, the KOSPI stood at 3,077.21, down 0.65% (20.62 points) from the previous trading day. The index opened the day at 3,111.10, up 0.43% (13.27 points) from the previous day, and rose to an intraday high of 3,122.09, but soon turned downward and continued to decline into the afternoon. Looking at investor trends, individual and institutional investors bought stocks worth 207 billion KRW and 8.8 billion KRW respectively, while foreign investors alone sold stocks worth 207 billion KRW.

The growing fear of tapering combined with the issue of liquidity tightening by the Chinese government is analyzed to have negatively impacted the index. On this day, despite market expectations that the People's Bank of China would lower the Loan Prime Rate (LPR) or the reserve requirement ratio, it decided to keep the interest rate unchanged. Sangyoung Seo, a researcher at Mirae Asset Securities, explained, “The index decline was influenced by spreading doubts that the Chinese government’s liquidity tightening is becoming a reality,” adding, “The Korean stock market can respond quite sensitively to changes in the Chinese stock market.”

Among the top market capitalization stocks, SK Hynix (0.49%) and LG Chem (0.56%) rose slightly, but all other stocks declined. Samsung Electronics (-0.41%), NAVER (-0.35%), Kakao (-1.37%), Samsung SDI (-0.39%), KakaoBank (-0.65%), and Hyundai Motor (-1.94%) also fell.

At the same time, the KOSDAQ index traded at 977.03, down 1.42% (14.12 points) from the previous trading day. The KOSDAQ opened at 997.02, up 0.59% (5.87 points) from the previous day, and briefly surpassed the 1,000 mark early in the session, but has since widened its losses. Looking at investor trends, individual investors alone bought stocks worth 80.7 billion KRW, while foreign and institutional investors sold stocks worth 63.6 billion KRW and 18.3 billion KRW respectively.

Among the top market capitalization stocks, Celltrion Healthcare (-1.49%), SK Materials (-0.35%), L&F (-3.24%), Seegene (-4.43%), and CJ ENM (-2.04%) declined, while EcoPro BM (0.55%), Celltrion Pharm (0.31%), Kakao Games (2.37%), Pearl Abyss (6.37%), and HLB (1.09%) rose.

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