Foreign and Institutional Selling Pushes KOSPI Down Over 2%... Impact of Chairman Powell's 'Hawkish' Speech

[Image source=Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] The KOSPI index is showing a decline of over 2% as foreigners and institutions continue to sell more than they buy. The KOSDAQ index also recorded a sharp drop due to selling pressure from individuals and institutions.

As of 9:42 AM on the 29th, the KOSPI index stood at 2,423.00, down 58.03 points (2.34%) from the previous session. The index opened at 2,432.06, down 48.97 points (1.97%) from the previous close, and widened its losses due to selling by foreigners and institutions. Foreigners and institutions sold approximately 48.8 billion KRW and 122.8 billion KRW respectively, while individuals alone net bought 166.2 billion KRW, helping to cushion the index's decline.

Among the top market capitalization stocks, all showed weakness. Kakao fell the most, down 4.21%. This was followed by Naver (-3.72%), LG Chem (-3.57%), Hyundai Motor (-3.10%), LG Energy Solution (-3.01%), SK Hynix (-2.94%), Samsung SDI (-2.73%), Samsung Electronics (-2.17%), Samsung Biologics (-2.01%), and Kia (-1.77%).

By sector, textiles and apparel dropped the most at 3.65%. Service industries (-3.28%), transportation and warehousing (-3.23%), medical precision (-2.92%), and electrical and electronics (-2.50%) also deepened their losses. Machinery (-0.84%), electric and gas utilities (-0.91%), and telecommunications (-1.12%) recorded the smallest declines.

At the same time, the KOSDAQ index was down 21.70 points (2.70%) to 780.75 compared to the previous trading day. It closed at 802.45 the day before but opened at 780.48, down 21.97 points (2.74%), breaking below the 800 mark. Individuals and institutions net sold about 700 million KRW and 27.5 billion KRW respectively, while foreigners net bought 33.9 billion KRW.

Among the top market capitalization stocks on KOSDAQ, Alteogen (-4.75%), Celltrion Pharm (-3.95%), Pearl Abyss (-3.94%), Studio Dragon (-3.78%), Celltrion Healthcare (-3.22%), L&F (-2.99%), EcoPro BM (-2.98%), Kakao Games (-2.87%), and EcoPro (-1.29%) declined. HLB (0.11%) was the only stock to record gains.

The domestic stock market is declining today as Fed Chair Powell reaffirmed a tightening stance in his speech at the Jackson Hole meeting. Powell stated, "We must maintain a restrictive stance for the time being," and added, "Unfortunately, reducing inflation comes with costs."

Following Powell's speech, the U.S. stock market also fell more than 3%. On the 26th (local time), the tech-heavy Nasdaq index closed down 497.55 points (3.94%) at 12,141.71. The Dow Jones Industrial Average dropped 1,008.38 points (3.03%) to 32,283.40, and the large-cap S&P 500 index fell 141.46 points (3.37%) to 4,057.66.

Han Ji-young, a researcher at Kiwoom Securities, explained, "Although the domestic stock market will face downward pressure reflecting the Jackson Hole shock early this week, the degree of expectation reflected was relatively lower than that of the U.S. market, so the downside rigidity is expected to be maintained."

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