After Dividend Cutoff and Nasdaq Plunge... KOSPI Falls Below 2300 Level for the First Time in Two Months

On the 28th, when the KOSPI index fell below the 2300 mark intraday for the first time in about two months, dealers were working in the Hana Bank dealing room in Jung-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Hwang Yoon-joo] The KOSPI index fell below the 2300 mark. This was due to sell-offs related to the ex-dividend date and the sharp decline in the US Nasdaq. The weakness in the automotive and secondary battery sectors was prominent among the two major indices.

On the 28th, the KOSPI closed at 2280.45, down 2.24% (52.34 points) from the previous day. The index started the day at 2296.45, down 1.56% (36.34 points), gradually widening the decline. It is the first time in about two months since October 31 (2293.61) that the KOSPI has closed below the 2300 level.

The index was dragged down by sell-offs ahead of the ex-dividend date. Foreigners and institutions sold a net 310.2 billion KRW and 828.7 billion KRW, respectively. In the futures market, foreigners sold 418.1 billion KRW, while institutions bought 185.1 billion KRW. Individuals were net buyers of 1.0771 trillion KRW. It is interpreted that individuals who sold stocks until the previous day to avoid major shareholder requirements began repurchasing today.

The sharp drop in the KOSPI appears to be largely influenced by the Nasdaq decline following the Tesla shock the previous day. Reuters and The Wall Street Journal (WSJ) reported that Tesla’s Shanghai factory will halt production from the 24th of last month until January 1 next year due to COVID-19 infections and other reasons. The nine-day production halt was considered unusual. This sparked concerns over a sharp drop in demand, and Tesla closed down 11.41%. Both the electric vehicle and secondary battery sectors were affected, and the Nasdaq index closed down 144.64 points (1.38%) at 10,353.23.

The KOSPI was also hit by the fallout. Among the top market capitalization stocks, only Samsung Biologics (+0.24%) closed higher. Kia (-4.99%) had the largest decline. This was followed by LG Energy Solution -4.49%, LG Chem -4.14%, Samsung SDI -3.37%, Samsung Electronics -2.58%, and Hyundai Motor -2.53%.

Lee Kyung-min, a researcher at Daishin Securities, explained, "The index fell more than 2% due to simultaneous net selling by foreigners and institutions. The cash dividend ex-dividend index is estimated to be 2296.4, down 1.56% from the previous day, and the additional decline excluding the ex-dividend effect is about 0.64%." He added, "This was due to the burden of rising US Treasury yields the previous day and the decline in the US stock market centered on tech stocks, which worsened investor sentiment. Excluding the ex-dividend effect, the decline in KOSPI was led by weakness in semiconductor and secondary battery representative stocks among the top market capitalization stocks."

The KOSDAQ also closed at 692.37, down 1.68% (11.82 points) from the previous day. Foreigners and institutions sold 215.6 billion KRW and 367.6 billion KRW, respectively. Meanwhile, individuals alone bought 590.9 billion KRW.

Looking at the top market capitalization stocks, all closed lower. Among them, secondary battery stocks were particularly weak. Ecopro BM (-5.82%) had the largest decline, followed by Ecopro -5.55%, Celltrion Healthcare -5.29%, and Celltrion Pharm -5.06%.

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