KOSPI Barely Closes in the 2440s Due to Bargain Hunting Inflow... 'Reality of Becoming a 50,000-Won Electronics Stock'

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] On the 17th, the KOSPI index briefly fell below the 2400 level, dropping to 2300, but it narrowed the intraday decline and closed above 2400. This is interpreted as a result of bargain buying due to the perception of an excessive drop, which reduced the extent of the decline.

On that day, the KOSPI closed at 2440.93, down 10.48 points (0.43%) from the previous trading day. The index opened at 2409.72, down 41.69 points (1.70%), and early in the session, it fell more than 2% to as low as 23396.47. The intraday break below 2400 was the first in 1 year and 7 months since November 5, 2020 (2370.85). However, as intraday anxiety eased somewhat afterward, the decline was significantly reduced compared to early in the session. On that day, buying by individuals and institutions led to the narrowing of the KOSPI's decline. Institutions net bought 357.1 billion KRW, and individuals net bought 276.4 billion KRW. Conversely, foreigners net sold 693.1 billion KRW.

The KOSDAQ closed at 798.69, down 3.46 points (0.43%) from the previous day, giving up the 800 level again after one day. The index opened at 787.97, down 14.18 points (1.77%) from the previous close, and during the session, it fell to as low as 780.96 before narrowing the decline. The KOSDAQ falling to the 780 level intraday was the first time in 1 year and 8 months since October 27, 2020 (766.96).

The sharp drop in the U.S. New York stock market overnight had a significant impact. The market views the Federal Reserve's (Fed) steep interest rate hikes as increasing concerns about a recession. Ultimately, the market is shaken as the view that aggressive rate hikes will cause a recession gains traction. Lee Kyung-min, a researcher at Daishin Securities, said, "Amid the global central banks' tightening stance, concerns about a recession have intensified," adding, "Due to persistently extremely contracted investment sentiment, volatility in the financial markets has expanded."

By sector in the KOSPI, most sectors declined. Electronics fell 1.18%, steel and metals 1.15%, distribution 1.09%, transportation and warehousing 1.01%, securities 0.9%, paper and wood 0.83%, banking 0.71%, finance 0.71%, electric and gas 0.59%, and non-metallic minerals 0.56% also declined. In the KOSDAQ sectors, transportation (-2.71%), broadcasting services (-2.09%), and telecommunications services (-1.94%) mostly closed lower, while distribution (0.79%), IT components (0.09%), and other services (0.06%) were among the few sectors that showed strength.

Most of the top market capitalization stocks in the KOSPI closed lower. In particular, the leading stock Samsung Electronics ended up back in the 50,000 KRW range. It fell 1.81% to 59,800 KRW, marking the first time in about 1 year and 7 months since November 4, 2020 (58,500 KRW) that it closed in the 50,000 KRW range. LG Energy Solution (0.35%), SK Hynix (1.03%), LG Chem (1.03%), and Naver (1.04%) also declined. However, most of the top 10 market capitalization stocks in the KOSDAQ rose. Celltrion Healthcare (1.63%), L&F (0.84%), Pearl Abyss (0.36%), Celltrion Pharm (1.64%), and Cheonbo (1.69%) increased, while EcoPro BM (-0.44%), Kakao Games (-2.09%), and HLB (-1.17%) declined.

Meanwhile, the won-dollar exchange rate rose. In the Seoul foreign exchange market, the won-dollar exchange rate closed at 1,287.3 won, up 1.7 won from the previous day.

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