Domestic Stock Market Weakens Amid US Interest Rate Hikes and Exchange Rate Rise... "Lackluster Trend Inevitable for the Time Being"

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[Asia Economy Reporter Park Jihwan] On the 5th, the domestic stock market, including KOSPI and KOSDAQ, continued a weak trend with a simultaneous decline of over 1%. This is interpreted as a negative impact on investor sentiment due to the overnight U.S. stock market falling, mainly in technology stocks, influenced by a sharp rise in interest rates. It is expected that the domestic stock market will continue to show sluggish movement for the time being.

As of 10:11 a.m., KOSPI was at 2,955.89, down 33.35 points (1.12%) from the previous day. The index started at 2,984.05, down 5.19 points (0.17%) from the previous session, and is widening its losses.

By investor type, individuals and foreigners net bought 428.5 billion KRW and 105.6 billion KRW, respectively. On the other hand, institutions net sold 550.8 billion KRW, pulling the index down.

Among the top 10 market capitalization stocks, the performance was mixed. Samsung Electronics (-1.91%), SK Hynix (-2.72%), Samsung Biologics (-2.36%), NAVER (-2.60%), and Kakao (-3.59%) declined. Meanwhile, Hyundai Motor and Kia rose by 2.14% and 3.47%, respectively, due to strong sales in the U.S. market.

At the same time, KOSDAQ was down 14.33 points (1.39%) from the previous day, at 1,017.33. The index started at 1,029.12, down 2.54 points (0.25%), and is expanding its losses.

By investor type, individuals alone net bought 215.4 billion KRW. Foreigners and institutions net sold 127.2 billion KRW and 83.5 billion KRW, respectively.

Among the top 10 market capitalization stocks, most showed a downward trend. Wemade had the largest decline at -5.26%. Celltrion Healthcare (-2.40%), EcoPro BM (-1.52%), Pearl Abyss (-2.22%), L&F (-3.47%), and Kakao Games (-2.99%) also declined.

The securities industry analyzed that the sharp rise in U.S. Treasury yields and the increase in the domestic exchange rate are negatively affecting the domestic stock market. As U.S. market interest rates have risen sharply since the beginning of the new year, growth stocks sensitive to interest rates are undergoing adjustments. As of the 4th local time, the U.S. 10-year Treasury yield surged to 1.66%, showing a steep upward trend. This is the highest level since the end of November last year at 1.67%. Additionally, the recent KRW-USD exchange rate approaching 1,200 won was also pointed out as a burden.

Lee Woongchan, a researcher at Hi Investment & Securities, said, "The domestic stock market is experiencing a correction mainly in growth stocks, which had risen significantly over the past year and a half due to monetary easing policies, influenced by the sharp rise in U.S. Treasury yields and the strong dollar," and added, "For the time being, the index is expected to continue a sluggish trend with limited downside."

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