KOSPI Falls to 2610 Amid US Credit Rating Downgrade... Sinks Sharply
The KOSPI fell nearly 2% due to the downgrade of the United States' credit rating.
On the 2nd, the KOSPI closed at 2,616.47, down 50.60 points (1.90%) from the previous trading day.
On that day, the KOSPI started lower compared to the previous trading day. Although it recovered some losses in the early session, the decline continued to deepen, falling more than 2%.
The reason for the decline is attributed to deteriorating investor sentiment following the downgrade of the U.S. credit rating. On the 1st (local time), after the New York stock market closed, Fitch, one of the three major international credit rating agencies, downgraded the U.S. long-term bond credit rating from 'AAA' to 'AA+'.
The downgrade was due to worsening governance related to the debt ceiling, fiscal deficits, and increased burden from rising interest costs. This is the first time since 2011 that the three major international credit rating agencies have downgraded the U.S. credit rating.
By investor type, foreigners and institutions sold net amounts of 85.3 billion KRW and 685.5 billion KRW, respectively. In contrast, individuals bought a net amount of 769.4 billion KRW.
By sector, steel and metals fell 3.75%. Transportation equipment, medical precision, electrical and electronics, manufacturing, transportation and warehousing, and machinery all declined more than 2%. Meanwhile, paper and wood and non-metallic minerals rose 3.14% and 2.02%, respectively.
All top market capitalization stocks declined. Samsung Electronics fell below 70,000 KRW, closing at 69,900 KRW, down 1,200 KRW (1.69%) from the previous trading day. POSCO Holdings dropped 5.80%, and SK Hynix and POSCO Future M fell more than 4%. Additionally, Kia, Kakao, and Hyundai Mobis also declined more than 3%.
On the Korea Stock Exchange that day, 232 stocks rose, including six stocks such as Deoksung, Korea Steel, and Seowon that hit the upper price limit. Meanwhile, 655 stocks fell without hitting the lower price limit, and 47 stocks remained unchanged.
The KOSDAQ closed at 909.76, down 29.90 points (3.18%) from the previous trading day.
By investor type, foreigners and institutions sold net amounts of 326.8 billion KRW and 200 billion KRW, respectively. In contrast, individuals bought a net amount of 554.6 billion KRW.
By sector, finance plunged 6.15%. Semiconductors and general electrical and electronics fell 5.18% and 4.85%, respectively. Other sectors such as miscellaneous manufacturing and pharmaceuticals also declined more than 3%. Meanwhile, digital content, publishing and reproduction, and construction rose slightly.
Among the top market capitalization stocks, EcoPro BM closed at 385,000 KRW, down 28,000 KRW (6.85%) from the previous trading day. HPSP and EcoPro fell 9.62% and 7.45%, respectively. POSCO DX and WCP also dropped more than 5%. On the other hand, SM rose 1.04%.
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On the KOSDAQ, 336 stocks rose, including four stocks such as Seonam, Mobis, and Powerlogics that hit the upper price limit. Meanwhile, 1,208 stocks fell without hitting the lower price limit, and 43 stocks remained unchanged.
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