'US Fed Reaffirms Tightening Stance'... Foreigners Sell KOSPI Futures and Spot'

Morning Market Update: KOSPI Declines Over 1%
KOSDAQ Hits Lowest Level Since May 2020
FOMC Minutes Released... Tightening Confirmed

[Image source=Yonhap News]

[Asia Economy Reporter Hwang Yoon-joo] The KOSPI index started lower on the 13th and widened its decline to over 1%. The KOSDAQ also fell nearly 3%, hitting a new yearly low. This is interpreted as increased downward pressure on supply and demand following the reaffirmation of the Federal Reserve's (Fed) tightening stance in the minutes of the U.S. Federal Open Market Committee (FOMC) released the previous day.

As of 11:29 AM, the KOSPI index stood at 2,176.74, down 1.17% (25.73 points) from the previous day. The KOSPI opened at 2,198.29, down 0.19% (4.18 points), but widened its losses during the morning session, breaking below the 2,180 level.

Foreigners and institutions increased their selling pressure. Foreigners and institutions are net selling 74 billion KRW and 96.1 billion KRW respectively. Foreigners sold 303.6 billion KRW in the futures market immediately after the opening and have sold a total of 9.9671 trillion KRW so far. Individual investors are the only buyers, net purchasing 164 billion KRW.

The Domestic Equity Team at Shinhan Financial Investment Research Center explained, "Downward pressure on supply and demand has increased due to the impact of option expiration, resulting in underperformance compared to other markets. Foreigners are net selling more than 10,000 contracts in KOSPI 200 futures."

Among the top market capitalization stocks, LG Energy Solution is still leading with a 1.24% gain. Other gainers include Celltrion (+0.91%), Kia (+0.73%), and SK Hynix (+0.11%). Naver recorded the largest decline at -3.09%, followed by LG Chem (-2.03%), Samsung SDI (-1.48%), Samsung Biologics (-1.34%), Hyundai Motor (-0.89%), and Samsung Electronics (-0.36%).

The declines in Naver and Kakao were notable. On this day, Kim Dong-woo, a researcher at Kyobo Securities, said, "Naver's third-quarter operating profit was 320.1 billion KRW (down 8.5% year-on-year, operating profit margin (OPM) 15.5%) due to a slowdown in growth in the high-margin advertising business," and predicted, "It likely fell short of the consensus estimate of 349.7 billion KRW."

Kakao closed at 47,600 KRW, down 4.51% (2,250 KRW) from the previous day, hitting a new 52-week low. This is interpreted as the stock price of Kakao, a representative growth stock, faltering following the Bank of Korea's interest rate hike the previous day.

As of 11:40 AM, the KOSDAQ index was trading at 652.76, down 2.82% (18.91 points) from the previous day. This is the lowest level since the 673.66 recorded on May 11, 2020. The KOSDAQ opened at 669.36, down 0.34% (2.31 points), but during the session fell as much as 2.91% to 652.10.

The KOSDAQ index is also falling due to combined selling by foreigners and institutions. Foreigners and institutions net sold 63.1 billion KRW and 95.2 billion KRW respectively. Meanwhile, individual investors are net buying 152.3 billion KRW.

Among the top market capitalization stocks, all are declining except for EcoPro BM (+2.21%). Pearl Abyss is down 9.38%, Kakao Games -7.28%, HLB -1.74%, JYP Entertainment -1.42%, and L&F -1.01%.

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