KOSPI Retreats to 2210 Level... Foreigners Turn Net Sellers After 13 Trading Days

[Image source=Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] The domestic stock market closed lower for the second consecutive trading day as foreigners and institutions showed a selling bias.

On the 20th, the KOSPI index closed at 2,218.09, down 19.35 points (0.86%) from the previous day. The index widened its decline to as low as 2,200.44 during the day but narrowed the loss to recover to the 2,210 level. Individuals net bought about 397.1 billion KRW, while foreigners and institutions sold 2.1 billion KRW and 408.7 billion KRW worth, respectively. Foreigners recorded net selling for the first time in 14 trading days. They sold nearly 300 billion KRW during the session but showed buying momentum in the late session.

Among the top market capitalization stocks, only Hyundai Motor (0.30%) recorded gains. LG Chem fell for the second consecutive day, dropping more than 4% on news of acquiring the U.S. biotech company Aveo. Following were SK Hynix (-2.91%), Samsung SDI (-2.81%), Samsung Biologics (1.42%), Kia (-0.87%), Samsung Electronics (-0.54%), and LG Energy Solution (-0.50%), all showing declines. Naver (NAVER) and Celltrion remained flat.

Additionally, Kakao, which experienced service disruptions due to a data center fire, also fell sharply. Kakao dropped more than 4%, while Kakao Bank (-3.16%) and Kakao Pay (-5.01%) also recorded declines.

By sector, securities, which face concerns over poor third-quarter earnings due to decreased commission income, fell the most by 3.43%. This was followed by chemicals (-2.30%), finance (-1.19%), and services (-1.14%). Meanwhile, machinery (2.10%), medical precision (1.24%), telecommunications (0.84%), construction (0.65%), and distribution (0.44%) sectors rose.

Kim Seok-hwan, a researcher at Mirae Asset Securities, explained, "The U.S. stock market fell the previous day as risks from the UK remained unresolved, and hawkish remarks from Federal Reserve officials led to rising Treasury yields and a strong dollar, dampening investor sentiment. The domestic market widened its losses in the morning due to declines in Chinese indices but partially recovered in the afternoon on expectations of eased COVID-19 entry restrictions from China."

He added, "The won-dollar exchange rate narrowed its rise, aligning with the yuan's strength due to reduced losses in major indices and expectations of shortened COVID-19 quarantine periods in China." The won-dollar exchange rate rose to 1,436 KRW but closed at 1,433.30 KRW, up 7.10 KRW from the previous day.

Lee Kyung-min, a researcher at Daishin Securities, said, "During the session, news that Chinese authorities are discussing shortening quarantine periods for overseas arrivals related to COVID-19 regulations helped the market partially recover losses. Following this news, the yuan strengthened, the dollar weakened, and the won-dollar exchange rate's rise narrowed, which positively influenced foreign investors to reduce their net selling."

The KOSDAQ index also closed lower on the day, down 10.12 points (1.47%) to 680.44. It fell to as low as 675.89 during the session but narrowed the loss. Individuals net bought about 308 billion KRW, defending against further declines. Foreigners and institutions bought approximately 150.3 billion KRW and 167.4 billion KRW, respectively.

Among the top market capitalization stocks, all showed weakness. L&F, a secondary battery stock, fell the most by 5.57% after Tesla's third-quarter earnings missed expectations. This was followed by EcoPro BM (-3.95%), HLB (-3.05%), Pearl Abyss (-3.02%), Celltrion Healthcare and Kakao Games (-2.62%), Lino Industrial (-2.06%), Chunbo (-1.93%), EcoPro (-1.74%), and Celltrion Pharm (-1.10%).

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