"Amid Reduced Tightening Concerns, Institutions Buy as KOSPI Attempts to Settle at 2730"

[Image source=Yonhap News]

[Asia Economy Reporter Myunghwan Lee] On the first trading day after the Lunar New Year holiday, the KOSPI and KOSDAQ indices, which started higher on the 3rd, continue their upward trend into the afternoon. In particular, the KOSPI is showing a rise of over 2% driven by institutional buying. The domestic stock market's successful rebound appears to be due to global markets recovering during the Lunar New Year holiday as the US Federal Reserve's (Fed) tightening concerns eased, recouping previous losses.

At 1:20 PM on the 3rd, the KOSPI stood at 2,725.62, up 2.34% (62.28 points) from the previous trading day. The KOSPI opened the day at 2,706.34, up 1.61% (43.00 points) from the previous close. As of 1:50 PM, institutions alone have net bought 202.7 billion KRW, driving the index higher. Foreign investors are also net buying slightly, around 19.4 billion KRW. Conversely, individual investors are selling about 212.1 billion KRW.

Top market capitalization stocks are all showing strength. Samsung Electronics is trading up 0.95% at 74,000 KRW. Other stocks such as LG Energy Solution (6.67%), SK Hynix (4.15%), NAVER (4.68%), Samsung Biologics (5.41%), LG Chem (5.32%), Hyundai Motor (2.64%), and Kakao (1.53%) are mostly rising. Samsung SDI is trading at the same price as the previous day. The strongest sectors in KOSPI are Medical Precision (+21.33%), Pharmaceuticals (+5.00%), and Paper & Wood (+3.09%).

At the same time, the KOSDAQ index is at 893.59, up 2.37% (20.72 points) from the previous trading day. The KOSDAQ opened at 887.85, up 1.72% (14.98 points) from the previous close. Individual and foreign investors are net buying approximately 5.7 billion KRW and 10.3 billion KRW respectively, while institutions are net selling about 56.5 billion KRW.

Most of the top market capitalization stocks in KOSDAQ are also on the rise. Celltrion Healthcare is trading up 3.68% at 64,800 KRW. Others showing gains include EcoPro BM (3.99%), L&F (6.16%), Kakao Games (3.20%), Wemade (0.86%), HLB (2.84%), Celltrion Pharm (5.45%), and CJ ENM (5.04%). Notably, Seegene is up 14.34% at 62,200 KRW due to increased demand for diagnostic kits, strengthening the diagnostic kit sector. On the other hand, Pearl Abyss is down (-2.02%). The strongest sectors in KOSDAQ are Broadcasting Services (+6.77%), Pharmaceuticals (+5.28%), and Textiles & Apparel (+3.75%).

Seonghoon Seo, a researcher at Samsung Securities, said, "As concerns over tightening have passed their peak, the domestic stock market is expected to seek a gradual rebound. The supply-demand noise caused by large initial public offerings (IPOs) has also been resolved after the holiday, making selective buying of stocks that have been oversold in the short term effective."

Meanwhile, securities firms have forecasted that the KOSPI could initially rise to 2800?2820 through a technical rebound this month and potentially reach 3000 in a secondary rise. Younghwan Kim, a researcher at NH Investment & Securities, said, "Concerns over the intensity of the US Federal Reserve's tightening have somewhat eased, and the solid earnings of US companies have reduced market uncertainty. Investor panic subsided late last week, and the market is expected to show a gentle rebound." He added, "Volatility is expected to increase depending on key variables such as inflation and other major economic indicators, COVID-19 case situations in major countries, and geopolitical risks in Ukraine," suggesting 2800 as the first technical rebound target and 3000 as the second target for KOSPI.

Daejun Kim, a researcher at Korea Investment & Securities, suggested a KOSPI band up to 2900. He said, "The short-term price burden has eased due to the recent sharp drop, and many negative factors suppressing the market have been largely reflected in stock prices. If the Fed's tightening burden and geopolitical risks in Eastern Europe ease further, higher levels than now can be expected."

Kyoungmin Lee, a researcher at Daishin Securities, said, "The overreaction to interest rate hike concerns is normalizing, and the supply-demand concentration phenomenon following LG Energy Solution's listing has passed its peak, making a technical rebound possible. With the easing of investment sentiment and recovery of supply-demand, an attempt to recover the KOSPI's 2800 level is feasible."

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