'2730 Hahoe Close' Too Early to Relax for Kospi... Attempts to Settle at 2750 Continue

by Lee Seonae

Published 21 Apr.2022 15:48(KST)

[Image source=Yonhap News]

[Asia Economy Reporter Lee Seon-ae] On the 21st, the KOSPI closed higher but ended the session below 2730. The index started the day with gains, breaking through 2730 during the session and maintaining momentum, but gave up some of the gains toward the end of trading. Market participants believe it is still premature to expect the index to have firmly entered an upward trajectory. However, it is anticipated that there will be continued attempts to settle above the short-term upper range of the box, around 2750.

On the day, the KOSPI rose 9.52 points to close at 2728.21 (up 0.35%), while the KOSDAQ increased by 0.75 points to finish at 929.68 (up 0.08%). During the session, the KOSPI surpassed 2730 and the KOSDAQ exceeded the 930 level, but gains narrowed toward the close.

Shinhan Financial Investment Research Center interpreted the rise in the KOSPI as being driven by a decline in U.S. interest rates and attention on the earnings of major domestic companies.

Lee Kyung-min, a researcher at Daishin Securities, also analyzed, "With the U.S. 10-year Treasury yield entering a pause just below the 3% level overnight and U.S. stock futures showing strength, the domestic stock market rose. Among individual stocks, the strong performance of large semiconductor companies such as Samsung Electronics and SK Hynix led the KOSPI's gains."

He added, "This week, the KOSPI has continued its upward trend, attempting to settle above the previously expected short-term box range upper limit of 2650?2720. Therefore, the possibility of attempting to recover 2750 has increased. However, we recommend minimizing weight increases above the 2700 level and maintaining a strategy of staggered buying to take advantage of volatility around the 2600 level."

On the day, institutional investors led the market. Financial investment firms, trust funds, and pension funds all engaged in net buying, providing upward momentum to the market. Institutions purchased approximately 637.2 billion KRW in the KOSPI and about 34.1 billion KRW in the KOSDAQ. In contrast, individual investors showed a net buying preference of 11.2 billion KRW only in the KOSDAQ market but sold about 567.2 billion KRW in the KOSPI. Foreign investors were net sellers in both markets, with sales of 57.7 billion KRW and 31.9 billion KRW respectively.