KOSPI at Risk of Falling Below 2500 Amid FOMC Caution... Foreign and Institutional Investors 'Selling'

Increased Decline in Secondary Battery Stocks
KOSDAQ Also Closes Lower... Ecopro Drops Over 8%

The KOSPI index closed down nearly 1% due to simultaneous selling pressure from foreigners and institutions.

[Image source=Yonhap News]

On the 3rd, the KOSPI index closed at 2,501.40, down 22.99 points (0.91%) from the previous trading day. The index opened at 2,510.19, down 14.20 points (0.56%), but the decline deepened, breaking below the 2,500 level during the session. It fell to as low as 2,497.83 but recovered above 2,500. Individual investors net bought about 351.4 billion KRW, while foreigners and institutions sold approximately 93.3 billion KRW and 261.7 billion KRW, respectively.

Among the top market capitalization stocks, most showed declines except Samsung Biologics, which rose 1.04%. LG Energy Solution fell the most, down 4.06%. This was followed by LG Chem (-2.68%), Samsung SDI (-2.29%), POSCO Holdings (-0.52%), Samsung Electronics and Kia (-0.46%), SK Hynix (-0.44%), NAVER (-0.31%), and Hyundai Motor (-0.25%).

By sector, chemicals (-2.47%), medical precision (-1.54%), electric and gas utilities (-1.43%), electrical and electronics (-1.19%), manufacturing (-1.10%), and construction (-0.99%) declined. Conversely, non-metallic minerals (1.90%), food and beverage (0.50%), pharmaceuticals (0.23%), and textiles and apparel (0.08%) showed strength.

Kim Seok-hwan, a researcher at Mirae Asset Securities, explained, "Investor sentiment weakened due to concerns over the Federal Open Market Committee (FOMC) and renewed banking risks," adding, "Foreign selling expanded, contrary to the previous trading day." He continued, "The index faced downward pressure mainly due to declines in large-cap stocks in the secondary battery and financial sectors," and noted, "Despite FOMC concerns, the dollar weakened on expectations that the May rate hike is in its final stage."

On the day, the USD/KRW exchange rate closed at 1,338.2 KRW, down 3.9 KRW from the previous day.

The market expects the Federal Reserve to raise the benchmark interest rate by 0.25 percentage points at this FOMC regular meeting. If the rate is increased by another 0.25 percentage points, the Fed's benchmark rate will rise to 5.00?5.25%, the highest level in 16 years. Additionally, the market anticipates that even if rates are raised at this meeting, a pause in hikes will be maintained for some time.

The KOSDAQ index closed at 843.18, down 12.43 points (1.45%) from the previous trading day. Individual investors alone net bought about 343.1 billion KRW, helping to defend against further index declines. Foreigners and institutions net sold 180 billion KRW and 162.8 billion KRW, respectively.

Among the top market capitalization stocks, EcoPro recorded the largest drop, falling 8.73%. This was followed by EcoPro BM (-6.55%), L&F (-3.78%), Celltrion Pharm (-3.32%), Kakao Games (-3.17%), HLB (-3.10%), Celltrion Healthcare (-1.89%), Pearl Abyss (-1.13%), and Osstem Implant (-0.43%). On the other hand, JYP Ent. rose 1.07%.

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