'Institutional Selling Pressure' Fails to Reverse KOSPI Rise... KOSDAQ Succeeds

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[Asia Economy Reporter Lee Seon-ae] On the 18th, the KOSPI market closed lower, failing to reverse its decline due to selling pressure from institutional investors, while the KOSDAQ market closed higher, supported by buying demand from individual investors, showing a contrasting trend.

On that day, the KOSPI closed down 8.38 points (-0.28%) at 3006.68, compared to the previous trading day (3015.06). Looking at investor trends, individuals and foreigners were net buyers of 417.3 billion KRW and 35 billion KRW respectively, but institutions led the decline by net selling 480.1 billion KRW.

By sector, most sectors closed lower, including transportation and warehousing (-1.91%), pharmaceuticals (-1.47%), and textiles and apparel (-1.38%), while only a few sectors such as services (+0.42%), food and beverages (+0.41%), and finance (+0.24%) showed strength.

Among the top market capitalization stocks, Samsung Electronics (+0.14%), NAVER (+0.76%), Hyundai Motor (+0.48%), and Kia (+0.48%) rose, while SK Hynix (-1.32%), LG Chem (-1.08%), Samsung Biologics (-1.27%), and Kakao (-0.41%) closed lower. Declining stocks numbered 429, while advancing stocks totaled 411, including 2 stocks hitting the upper limit.

The KOSDAQ closed up 3.32 points (+0.34%) at 993.86, compared to the previous trading day (990.54). Looking at investor trends, individuals were net buyers of 113.6 billion KRW, while foreigners and institutions were net sellers of 74.4 billion KRW and 7.9 billion KRW respectively.

By sector, entertainment and culture (+2.73%), general electrical and electronics (+1.79%), and digital content (+1.71%) showed strength, while transportation (-1.23%), non-metallic minerals (-1.16%), and information technology (-1.12%) closed lower. Among the top market capitalization stocks, Celltrion Healthcare (-1.45%), Pearl Abyss (-3.30%), HLB (-1.21%), Celltrion Pharm (-1.29%), and SK Materials (-1.13%) declined, while EcoPro BM (+3.67%), L&F (+2.81%), Kakao Games (+5.33%), Wemade (+4.74%), and CJ ENM (+3.18%) closed higher. Advancing stocks numbered 658, including 2 hitting the upper limit, while declining stocks numbered 681, including 1 hitting the lower limit.

Kim Seok-hwan, a researcher at Mirae Asset Securities, said, "Despite positive factors such as strong U.S. retail sales data, corporate earnings, and increased likelihood of infrastructure bill passage, concerns over slowing growth due to China's GDP announcement limited gains. Foreigners switched to buying in both spot and futures markets, attempting a KOSPI rebound, but the reduced supply and demand led to a renewed decline."

Meanwhile, Kiwoom Securities forecast that the domestic stock market this week will show an upward trend with higher lows, influenced by macro events such as easing inflation anxiety, manufacturing PMI results from major countries, and domestic export-import results for October (~20th). With rising expectations for the U.S. third-quarter earnings season, this U.S.-originated positive momentum is expected to positively influence market participants' outlook on the domestic third-quarter earnings season (weekly KOSPI expected range 2950~3090).

Han Ji-young, a researcher at Kiwoom Securities, explained, "Despite the base effect, lingering impact of the Delta variant, and inflation-driven margin contraction concerns, the current U.S. third-quarter earnings season is progressing better than expected, contributing to a recovery in risk asset preference sentiment. What this confirms is that the recent major country stock market corrections since late September were driven not by fundamentals but by sentiment contraction (sentiment contraction can create rapid downward pressure on the market in a short period, but conversely, when sentiment recovers, the market tends to rebound quickly)."

She added, "Similar to the U.S., despite the ongoing annual earnings level-up trend, expectations for the domestic third-quarter earnings season are not high, and concerns about inevitable downward revisions to earnings forecasts persist. However, since these concerns were somewhat priced in after the end of the second-quarter earnings season last summer, if many companies report earnings surprises better than expected in the third-quarter earnings season or if the extent of downward earnings revisions is less severe than anticipated, earnings momentum will be reestablished, which is expected to open the upside for the domestic stock market going forward."

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