KOSDAQ Market Cap Drops by 19 Trillion Won in One Day... The Cost of Concentration

Volatility Expands Amid Concentration in Secondary Battery Stocks
KOSDAQ Falls Over 4%, Barely Holding the 900 Level

KOSDAQ market capitalization evaporated by as much as 19 trillion won in just one day. This was due to increased volatility caused by excessive concentration in secondary battery stocks.

According to the Korea Exchange on the 26th, KOSDAQ closed the day at 900.63, down 4.18% from the previous day. Although KOSDAQ surged to 956.40 during the session, it barely held above the 900 level, giving up all the gains made over the past week.

KOSDAQ market capitalization, which had reached a record high of 454.5705 trillion won just four days ago, decreased to 435.333 trillion won due to the stock price decline.

Due to excessive concentration in secondary battery stocks, volatility expanded and KOSDAQ experienced a rollercoaster ride that day. In the morning, large secondary battery stocks surged by over 10%, pushing KOSDAQ above the 950 level. However, in the afternoon, as the gains in secondary battery stocks rapidly shrank, KOSDAQ fell more than 5% at one point during the session, dropping to the 880 level. The highest intraday price of KOSDAQ was 956.4, and the lowest was 886.14, resulting in a fluctuation range of 70.26 points. The trading volume on KOSDAQ that day was 26.2002 trillion won, marking a record high in 1,063 days.

Choi Yoo-jun, a researcher at Shinhan Investment Corp., analyzed, "As the concentration in secondary battery stocks continued, the supply and demand situation weakened from the morning, and most stocks declined. In the afternoon, individuals started to realize profits on secondary battery-related stocks, and with increased market volatility, there was also a volume presumed to be margin loan repayments, creating a situation where volatility bred more volatility."

Individuals led the KOSDAQ decline by realizing profits. Although individuals showed a buying preference early in the session, they turned to selling later, and as the selling volume expanded, the index plunged sharply. On that day, individuals sold 617.7 billion won in the KOSDAQ market. They sold EcoPro BM the most, with net sales of 291.2 billion won, followed by EcoPro (151.5 billion won), LG Energy Solution (81.5 billion won), SK IE Technology (80.5 billion won), LG Chem (69.2 billion won), and L&F (52.6 billion won), realizing profits.

Secondary battery stocks initially continued their strong performance by hitting 52-week highs early in the session but turned downward due to individual profit-taking. EcoPro, which soared to 1,539,000 won during the session, closed at 1,228,000 won, down 5.03% from the previous day. EcoPro BM rose to 584,000 won intraday but closed down 1.52% at 455,000 won. On the KOSPI market, POSCO Holdings hit a 52-week high of 764,000 won during the session but closed at 630,000 won, down 4.26% from the previous day. POSCO Future M also rose to 694,000 won intraday but ended trading at 560,000 won, down 6.35%. LS Group stocks, which have recently surged by riding the secondary battery theme, also recorded numerous 52-week highs. LS rose to 151,300 won intraday but closed down 5.91% at 113,000 won. LS ELECTRIC also hit a 52-week high of 137,500 won before plunging 17.23% to close at 95,600 won. LS Cable & System Asia reached 9,930 won to record a high but closed at 7,340 won, down 10.27%.

While supply and demand issues are expected to normalize over time, a weakening of investor sentiment seems inevitable. Researcher Choi said, "Supply and demand issues are shaking the market, but parts that are less related to fundamentals will gradually normalize over time. During this process, there may be pressure from margin loan liquidations due to increased volatility and a weakening of investor sentiment."

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