Foreign and Institutional Buying Drives KOSPI to Close Higher After 5 Trading Days... KOSDAQ Recovers to 750 Level

[Image source=Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] The KOSPI index closed higher due to simultaneous buying by foreigners and institutions. The KOSDAQ index rose nearly 4%, recovering the 750 level on a closing basis for the first time in four trading days.

On the 5th, the KOSPI index closed at 2,341.78, up 41.44 points (1.80%) from the previous trading day. The index started trading at 2,322.11, up 21.77 points (0.95%) from the previous day, and the rise accelerated as foreigners and institutions jointly bought. Foreigners and institutions purchased about 135 billion KRW and 239.3 billion KRW respectively, while individuals net sold about 389.5 billion KRW. This was the first time in five trading days that the KOSPI index closed higher. Although it fluctuated around the 2,300 level the previous day and hit its lowest point in about 1 year and 8 months since November 2, 2020, it showed strength on this day.

Among the top market capitalization stocks, most recorded gains except Hyundai Motor (-0.28%) and Kia (-0.13%). Samsung SDI rose 5.93%, marking the largest increase. It was followed by Kakao (5.73%), SK Hynix (3.82%), Naver (3.40%), LG Chem (2.40%), Samsung Biologics (1.77%), LG Energy Solution (1.54%), and Samsung Electronics (0.18%).

By sector, medical precision equipment showed strong performance, rising 5.35%, the largest increase among all sectors, same as the previous trading day. This was followed by pharmaceuticals (3.67%), steel & metals (3.24%), textiles & apparel (3.09%), paper & wood (3.06%), and services (2.90%). On the other hand, the food & beverage sector fell 0.18%, the only sector to decline.

On the same day, the KOSDAQ index rose nearly 4% as foreigners and institutions simultaneously bought for the first time in seven trading days. It closed at 750.95, up 28.22 points (3.90%) from the previous day. Foreigners and institutions net bought about 275.1 billion KRW and 80.7 billion KRW respectively, leading the index's rise, while individuals net sold about 327.9 billion KRW.

Among the top market capitalization stocks, all recorded gains. EcoPro BM rose 7.69%, and Alteogen increased by 7.00%. L&F and Chunbo each rose 5.68%, followed by Kakao Games (5.57%), Celltrion Pharm (5.56%), Studio Dragon (4.23%), Celltrion Healthcare (3.47%), Pearl Abyss (2.77%), and HLB (2.08%).

Kim Seok-hwan, a researcher at Mirae Asset Securities, explained, "Both KOSPI and KOSDAQ rose due to inflows of bargain hunting. Recently, the decline in raw material prices has expanded expectations of an inflation peak-out, and positive factors such as the U.S. government's expectation to cancel additional tariffs on China and the possibility of a ceasefire in Russia also played a role." He added, "Despite the weak won trend, foreigners and institutions continued to buy spot stocks, driving the index higher." On the day, the won-dollar exchange rate in the Seoul foreign exchange market closed at 1,300.3 won, up 3.2 won from the previous trading day.

However, some opinions suggest it is difficult to see this as a sustained uptrend. Han Jae-hyuk, a researcher at Hana Securities, said, "It appears to be bargain hunting due to excessive price drops," adding, "Since prices had fallen significantly, the rebound was relatively large." He further noted, "Concerns about an economic recession still exist in the market, so it is premature to consider this a sustained uptrend."

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