KOSPI Develops 'Resistance to Negative Factors,' Surpasses 2730... Will Institutional Net Buying Intensify?

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] On the 21st, the domestic stock market started higher. The Federal Reserve (Fed) highlighted confidence by mentioning solid growth in the U.S. economy and upgrading the economic outlook through the Beige Book (economic outlook report). Additionally, the increase in demand from U.S. Treasury bond auctions and the recent pullback following the rise in U.S. Treasury yields, along with the potential inflow of a won-strengthening trend due to the weak dollar, are creating a favorable environment. The stock market, which has developed resilience to negative factors, is interpreted to be continuing its upward trend in response to positive expectations.

On this day, the KOSPI opened at 2,725.71, up 7.02 points, and the KOSDAQ opened at 930.45, up 1.52 points. Early in the session, the KOSPI expanded its gains and surpassed the 2,730 level. The KOSDAQ is also holding above 930. Institutional demand is also supporting the market. From early in the session, both the KOSPI and KOSDAQ markets are recording net purchases. As of 9:10 a.m., institutions have bought approximately 43.7 billion KRW and 3 billion KRW in the two markets, respectively. Meanwhile, foreigners show a net selling bias of 24 billion KRW in the KOSPI market and a net buying bias of 1.9 billion KRW in the KOSDAQ market. Institutions, which showed net buying the previous day, have switched to net selling today, offloading approximately 25.9 billion KRW and 6.2 billion KRW in the two markets, respectively.

By sector on the KOSPI, machinery (+0.85%), pharmaceuticals (+0.81%), and food and beverages (+0.57%) are showing strength, while services (-0.66%) are declining. On the KOSDAQ, metals (+0.75%), general electrical and electronics (+0.56%), and transportation equipment and parts (+0.54%) are strong, whereas entertainment and culture (-0.42%), other manufacturing (-0.41%), and food, beverages, and tobacco (-0.26%) are declining.

Seosangyoung, a researcher at Mirae Asset Securities, forecasted, "The Fed Beige Book confidence and the potential inflow of a won-strengthening trend due to the weak dollar suggest that the Korean stock market will show a solid performance."

Han Ji-young, a researcher at Kiwoom Securities, said, "Despite the Netflix stock plunge incident, the domestic stock market is expected to show an upward trend as much of it was already reflected in the previous trading day, influenced by individual domestic earnings issues and export results up to the 20th." She added, "Tesla, which announced earnings after the U.S. market close, posted an earnings surprise, and it indicated that the Shanghai shutdown shock in March would be limited. This led to a sharp rise of over 4% in after-hours trading, which is a positive factor and will contribute to improving investment sentiment in domestic electric vehicle and secondary battery value chain-related stocks."

Meanwhile, on the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 35,160.79, up 249.59 points (0.71%) from the previous session. The large-cap S&P 500 index closed slightly lower at 4,459.45, down 2.76 points (0.06%). The tech-heavy Nasdaq index recorded 13,453.07, down 166.59 points (1.22%).

Netflix announced after the previous day's close that its first-quarter subscriber count unexpectedly decreased by 200,000. This was the first decline in over a decade and caused significant disappointment in the market, which had expected a substantial increase in subscribers. Netflix's stock plunged more than 35% that day, worsening investment sentiment in tech stocks. IBM reported sales and net income exceeding expectations, pushing its stock up more than 7%. By sector, real estate (+1.9%), consumer staples (+1.4%), and healthcare (+1.3%) were strong, while communication (-4.1%), consumer discretionary (-1.4%), and technology (-0.1%) were weak.

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