KOSPI Falls 1.35% to 2970 Level... Impact of Foreigners Selling Spot and Futures

[Image source=Yonhap News]

[Asia Economy Reporter Park Jihwan] On the morning of the 20th, the KOSPI fell by more than 1%, dropping to the '2970 level.' This appears to be influenced by the decline in the U.S. stock market, which closed lower due to the spread of Omicron centered in Europe and hawkish remarks from Federal Reserve (Fed) officials. In particular, the withdrawal of foreign investors, who had been leading the recovery of the domestic stock market, accelerated the downward trend.

As of 11:11 a.m. on the 20th, the KOSPI was at 2977.00, down 1.35% (40.73 points). The index started the day at 3001.33, down 0.54% (16.40 points) from the previous trading day, and briefly recovered to the 2990 level, but the upward momentum soon faded.

The weakness in the index on this day is interpreted as due to the deterioration of investment sentiment among foreigners who had recently been driving the KOSPI. Foreigners sold a net 234.2 billion KRW, pulling the index down. Institutions also showed a selling bias with net sales of 338.7 billion KRW. On the other hand, individuals bought a net 552.4 billion KRW.

Foreign investors seem to be weighing the possibility of sideways or downward movement in the short term for the Korean stock market. In the futures market, foreigners are net sellers of 4,915 contracts, indicating a negative outlook on the domestic market. Conversely, individuals are net buyers of 1,599 contracts, and institutions are net buyers of 3,266 contracts. Jeong Inji, a researcher at Yuanta Securities, said, "Considering that the cumulative net buying of foreign futures contracts exceeded 90,000 contracts just before the December expiration, the current level is significantly reduced. It is likely to move sideways for now, but if a direction emerges, the position seems to weigh more on the possibility of a decline."

At the same time, the KOSDAQ was at 995.60, up 0.57% (5.66 points) from the previous trading day. The index started lower but reduced its losses to recover the 'Thousand-Sdak' level, before expanding the decline again.

By investor type, individuals are net buyers of 101 billion KRW, institutions net buyers of 2.8 billion KRW, while foreigners are net sellers of 101.4 billion KRW.

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