KOSPI Ends Down Over 1% as Exchange Rate Breaks Ceiling for First Time in 13 Years... KOSDAQ Falls Below 800

[Image source=Yonhap News]

[Asia Economy Reporter Myunghwan Lee] On the 22nd, the domestic stock market closed down across the board, falling more than 1%. This is presumed to be due to a contraction in investor sentiment as the won-dollar exchange rate surpassed the 1,340 won level for the first time in 13 years. Institutional investors sold off more than 200 billion won in the KOSPI market, accelerating the index decline.

On that day, the KOSPI closed at 2,462.50, down 1.21% (30.19 points) from the previous trading day. The KOSPI opened at 2,467.38, down 1.02% (25.31 points), and the decline deepened in the afternoon as the exchange rate began to surge.

By investor type, institutions engaged in large-scale selling, offloading 237.8 billion won worth of stocks. In contrast, individuals and foreigners were net buyers, purchasing 131.4 billion won and 116.8 billion won worth of stocks, respectively.

Kim Seok-hwan, a researcher at Mirae Asset Securities, explained the market decline by saying, "The U.S. stock market fell due to profit-taking mainly in large tech stocks amid a nearly 3% rise in U.S. Treasury yields, hawkish stances from Federal Reserve (Fed) officials, tightening concerns, and a strong dollar. This was reflected in the domestic market as well." He added, "Most sectors were down, with the KOSDAQ experiencing a larger decline compared to the KOSPI, particularly due to weakness in tech stocks such as KOSDAQ gaming and IT."

In particular, the high exchange rate limited foreign buying, impacting the domestic market. On that day, the won-dollar exchange rate closed at 1,339.8 won, up 13.9 won from the previous trading day in the Seoul foreign exchange market. During the afternoon session, the exchange rate rose to 1,340.2 won per dollar, up 14.3 won from the previous day's closing price. This was the first time in about 13 years and 4 months that the exchange rate exceeded 1,340 won, since April 29, 2009, when it reached 1,357.5 won (high price) during the financial crisis. Researcher Kim said, "The won-dollar exchange rate broke through 1,340 won during the session, intensifying the dollar's strength," and explained, "The strong dollar limited foreign buying, leading to further index declines."

All of the top 10 stocks by market capitalization in the KOSPI market closed down. Samsung Electronics closed at 60,000 won, down 1.48% (900 won) from the previous day, narrowly holding the '60,000 won electronics' level. SK Hynix also fell 1.24%. Battery-related stocks such as Samsung SDI (-2.91%) and LG Energy Solution (-1.01%) declined. Additionally, Kakao (-2.22%), Samsung Biologics (-1.96%), Samsung Electronics Preferred (-1.97%), NAVER (NAVER) (-1.01%), Hyundai Motor (-0.53%), and LG Chem (-0.16%) also showed declines.

[Image source=Yonhap News]

Socar, which was listed on the domestic stock market that day, closed at a price lower than its public offering price. Socar ended its first trading session at 26,300 won, down 6.07% (1,700 won) from its opening price. This is below the public offering price of 28,000 won.

By industry, only telecommunications (0.46%) and non-metallic minerals (0.07%) showed slight gains, while textiles and apparel (-1.87%), paper and wood (-1.86%), and steel and metals (-1.74%) experienced significant declines.

The KOSDAQ index closed at 795.87, down 2.25% (18.30 points) from the previous trading day. The KOSDAQ opened at 806.90, down 0.89% (7.27 points), and the decline accelerated in the afternoon, breaking below the 800-point level.

In the KOSDAQ market, institutions alone sold stocks worth 185.4 billion won, while individuals and foreigners were net buyers, purchasing 150.4 billion won and 42.6 billion won worth of stocks, respectively.

Top market capitalization stocks in the KOSDAQ also closed down. Battery-related stocks such as L&F (-3.25%), Chunbo (-3.20%), EcoPro (-2.16%), and EcoPro BM (-0.88%) showed significant declines. Kakao Games (-3.43%) and Pearl Abyss (-1.21%) also fell. Additionally, Alteogen (-2.79%), Celltrion Pharm (-2.20%), HLB (-1.40%), and Celltrion Healthcare (-0.40%) declined.

By sector in the KOSDAQ, food and tobacco rose 2.25%, while telecommunications services (-4.95%), digital content (-3.52%), and broadcasting services (-3.45%) showed notable declines.

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