Foreigners and Institutions Sell in Tandem... KOSPI Falls Below 3000, Volatile Recovery Struggles

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] The KOSPI index is showing intense fluctuations around the 3000-point mark, falling below 3000 before recovering again. With the U.S. Federal Open Market Committee (FOMC) regular meeting just a day away, there is heightened caution over possible mentions of inflation and tapering (asset purchase reduction).

As of 11 a.m. on the 3rd, the KOSPI stood at 2989.19, down 0.80% from the previous trading day. This decline is interpreted as being caused by the withdrawal of foreign and institutional investors.

Foreigners and institutions are net selling approximately 239.1 billion KRW and 131.1 billion KRW respectively. Only individual investors are showing a net buying preference of about 364.8 billion KRW.

The weak sectors in KOSPI are transportation and warehousing (-1.56%), chemical industry (-1.39%), and finance (-1.16%), while the strong sectors are medical precision instruments (+1.72%), non-metallic minerals (+0.98%), and paper and wood (+0.39%).

Seosangyoung, a researcher at Mirae Asset Securities, explained, "Although the U.S. stock market was solid, the decline in government bond yields and international oil prices, along with the strengthening of the dollar and yen, has increased preference for safe assets, which is burdening foreign investor demand. With the FOMC regular meeting approaching, there is also a possibility of selling pressure, leading to a cautious stance."

Han Ji-young, a researcher at Kiwoom Securities, also advised, "The domestic stock market should be cautious about the possibility of increased intraday demand volatility as short-term cash securing sell-offs emerge following the previous day's over 1% rise amid FOMC caution."

Meanwhile, the KOSDAQ index is down 0.05% at 1008.94. It started above the 1010 level but quickly turned downward and is maintaining a sideways trend. Individual investors show a net buying preference of 12.2 billion KRW, while foreigners and institutions are net sellers by 2.7 billion KRW and 7.2 billion KRW respectively. The strong sectors are general electric and electronics (+1.97%), digital content (+1.88%), and textiles and apparel (+1.26%), while the weak sectors are broadcasting services (-4.08%), internet (-1.50%), and transportation equipment and parts (-1.26%).

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