'FOMC Caution' KOSPI Ends Flat... KOSDAQ Falls Amid Foreign and Institutional Selling

[Image source=Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] Ahead of the Federal Reserve's (Fed) November Federal Open Market Committee (FOMC) regular meeting, the KOSPI index closed flat.

On the 2nd, the KOSPI index closed at 2,336.87, up 1.65 points (0.07%) from the previous trading day. The index started at 2,326.05, down 9.17 points (0.39%), but turned upward and rose to 2,346.32. However, selling pressure from individual investors intensified, causing the index to turn downward and fluctuate before remaining flat. Individuals and institutions net sold approximately 183.3 billion KRW and 338.3 billion KRW respectively, while foreigners were the sole net buyers with about 496.3 billion KRW. Foreigners recorded net buying dominance for the third consecutive trading day.

Among the top market capitalization stocks, Naver (NAVER) rose the most, up 2.05%. It was followed by LG Energy Solution (1.07%), Celltrion (0.81%), SK Hynix (0.72%), and Hyundai Motor (0.30%). On the other hand, Samsung SDI fell more than 4%, followed by LG Chem (-3.31%), Samsung Biologics (-1.02%), Samsung Electronics (-0.67%), and Kia (-0.15%). KakaoBank surged 17.05% after disclosing that its third-quarter net profit increased by 51.3% year-on-year to 78.7 billion KRW.

By sector, services (1.81%), food and beverage (0.93%), finance (0.87%), steel and metals (0.60%), and insurance (0.55%) rose. Conversely, machinery fell more than 3%, followed by non-metallic minerals (-2.01%), electric and gas utilities (-1.76%), textiles and apparel (-1.26%), construction (-1.08%), and electrical and electronics (-0.41%).

The US stock market closed lower the previous day. On the 1st (local time), the S&P 500 index, centered on large-cap stocks, fell 15.88 points (0.41%) to 3,856.10, the tech-heavy Nasdaq index dropped 97.30 points (0.89%) to 10,890.85, and the Dow Jones Industrial Average declined 79.75 points (0.24%) to 32,653.20.

The market opened higher on expectations of a slowdown in the Fed's rate hike pace, but the US stock market declined as the dollar strengthened following an increase in US job openings in September. According to the September Job Openings and Labor Turnover Survey (JOLTS), US companies had 10.7 million job openings, up from 10.3 million the previous month, exceeding experts' forecast of 9.8 million. Additionally, the US Institute for Supply Management (ISM) manufacturing Purchasing Managers' Index (PMI) for October was 50.2, surpassing the market expectation of 50.0.

Lee Kyung-min, a researcher at Daishin Securities, explained, "Robust US employment data and the ISM manufacturing index still exceeded the baseline of 50, which partially reduced expectations for a slowdown in tightening, acting as a factor increasing downward pressure on the stock market."

Kim Seok-hwan, a researcher at Mirae Asset Securities, said, "The two major domestic indices gave back gains ahead of the FOMC due to caution. The release of strong US employment data reduced expectations for a slowdown in the Fed's rate hikes, and profit-taking from the previous day's rise led to expanded sector rotation selling."

The won-dollar exchange rate closed at 1,417.4 won, up 0.2 won from the previous trading day's closing price.

The KOSDAQ index closed lower that day, down 2.68 points (0.38%) to 697.37. The index started at 697.40, down 2.65 points (0.38%), and fell to as low as 694.94. Individuals bought about 249.5 billion KRW worth, while foreigners and institutions net sold approximately 66.4 billion KRW and 184.5 billion KRW respectively.

Among the top market capitalization stocks, Pearl Abyss rose more than 7%, followed by Celltrion Healthcare (1.47%) and Celltrion Pharm (1.20%). Wemade, which announced it attracted an investment of 66 billion KRW (about 46 million USD) from Microsoft, Shinhan Asset Management, and Kiwoom Securities, surged 21.48%. On the other hand, L&F and EcoPro BM fell more than 5%, and EcoPro declined 4.61%. Rino Industrial (-1.73%), Chunbo (-1.56%), Kakao Games (-0.25%), and HLB (-0.13%) also fell.

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