'Black Monday'... KOSPI Closes Below 2800 for the First Time in 13 Months

Increasing Synchronization with US Stock Market... Rising Tightening Concerns Ahead of FOMC
KOSDAQ Closes Down 2.91%

[Image source=Yonhap News]

[Asia Economy Reporter Gong Byung-sun] The KOSPI closed below the 2800 mark for the first time in 13 months. As the synchronization with the U.S. stock market becomes more evident, the domestic stock market is on edge over the intensity of tightening measures to be announced by the U.S. Federal Open Market Committee (FOMC).

On the 24th, the KOSPI closed at 2792.00, down 1.49% (42.29 points) from the previous day. This is the first time the KOSPI has closed below 2800 since December 23, 2020, about 13 months ago. It even dropped to 2780.68 at 12:04 PM that day.

A synchronization phenomenon with the U.S. stock market is emerging. On the 21st (local time) at the New York Stock Exchange, the Dow Jones Industrial Average closed at 34,265.37, down 1.30% (450.02 points) from the previous day. The S&P 500 index fell 1.89% (84.79 points) to 4,397.94, and the tech-heavy Nasdaq closed down 2.72% (385.10 points) at 13,768.92.

Park Seung-jin, a researcher at Hana Financial Investment, said, “Inflation has been excluded from the FOMC statement’s criteria for rate hikes for now, and whether maximum employment is achieved is important,” but added, “Until the inflation trend meaningfully stabilizes, the Federal Reserve’s signals for tightening will continue.”

Last month, the FOMC projected a total of eight rate hikes: three this year, three next year, and two in 2024, according to the dot plot. The dot plot is a chart where Fed officials anonymously record their annual rate hike projections.

Sales by individuals and foreigners led to the index decline. Individuals and foreigners sold a net 136.5 billion KRW and 435.1 billion KRW, respectively. Institutions bought a net 592.2 billion KRW.

Most sectors declined. The textile and apparel sector had the largest drop at 3.62%. This was followed by steel and metals (-3.20%), transportation and warehousing (-2.91%), machinery (-2.55%), and chemicals (-2.50%). Food and beverages (1.15%) and medical precision (0.20%) sectors rose.

All of the top 10 market capitalization stocks except SK Hynix fell. LG Chem had the largest drop at 3.31%, followed by KB Financial (-2.49%), Kakao (-1.96%), Hyundai Motor (-1.50%), Kia (-1.37%), NAVER (-1.35%), Samsung Biologics (-0.86%), Samsung SDI (-0.29%), and Samsung Electronics (-0.66%). SK Hynix remained flat.

The KOSDAQ closed at 915.40, down 2.91% (27.45 points) from the previous day. It dropped to 911.02 at 11:35 AM.

Foreigners’ selling pressure was strong. Foreigners sold a net 140 billion KRW. Individuals and institutions bought a net 111.8 billion KRW and 42.5 billion KRW, respectively.

All sectors declined. The general electronics sector had the largest drop at 5.47%, followed by entertainment and culture (-5.34%), digital content (-4.73%), IT software & services (-4.37%), and paper & wood (-4.27%).

Most of the top 10 market capitalization stocks fell. Pearl Abyss had the largest drop at 7.89%, followed by EcoPro BM (-7.70%), Wemade (-5.99%), HLB (-3.25%), Kakao Games (-2.92%), Cheonbo (-1.33%), and L&F (-1.01%). Seegene (4.32%), Celltrion Healthcare (1.95%), and Celltrion Pharm (0.45%) rose.

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