KOSPI and KOSDAQ Both Fall Over 1%...Individual Investors Alone 'Buy'

by Lee Myeonghwan

Published 27 Apr.2022 14:02(KST)

On the 27th, when the KOSPI and KOSDAQ indices plunged by over 2%, dealers were working in the dealing room of Hana Bank in Euljiro, Seoul. The U.S. stock market sharply declined due to concerns over a slowdown in the economic recession and earnings uncertainty among big tech companies, which appears to have caused a chain reaction. Photo by Moon Honam munonam@

[Asia Economy Reporter Myunghwan Lee] On the 27th, the KOSPI and KOSDAQ indices are still showing a downward trend in the middle of the trading session. Amid the declining market, individual investors alone are supporting the market by purchasing 800 billion KRW worth of stocks across both markets.

As of 1:40 PM, the KOSPI is at 2,633.25, down 1.31% (35.06 points) from the previous trading day. The index opened at 2,630.58, down 1.41% (37.73 points) from the previous day, and after falling nearly 2%, it continues to decline. By investor type, individuals are net buyers with 650.6 billion KRW, while foreigners and institutions sold 396.6 billion KRW and 253.5 billion KRW worth of stocks, respectively.

By sector, banks (-2.04%), financials (-1.80%), and securities (-1.72%) showed the largest declines. This is attributed to a slight drop in the U.S. 10-year Treasury yield, which had approached the 3% range, causing global financial stocks to fall. Other sectors such as telecommunications (-3.69%) and paper & wood (-1.95%) also mostly declined.

Most of the top market capitalization stocks are in the red. Samsung Electronics fell 1.51% to 65,100 KRW, hitting a new low again. Other decliners include LG Energy Solution (-3.07%), SK Hynix (-2.70%), Samsung Biologics (-0.50%), Samsung Electronics Preferred (-1.86%), NAVER (-2.96%), Hyundai Motor (-0.27%), Kakao (-2.11%), and Kia (-0.36%). Samsung SDI (0.52%) is the only stock showing gains.

At the same time, the KOSDAQ index is at 894.87, down 1.79% (16.29 points) from the previous day. The KOSDAQ opened at 898.02, down 1.44% (13.14 points), then fell more than 2% before narrowing the decline. In the KOSDAQ market, individuals are net buyers with 204.9 billion KRW, while foreigners and institutions are net sellers with 56.5 billion KRW and 147.2 billion KRW, respectively.

By sector, digital content (-8.33%), IT software (-5.16%), and food & tobacco (-4.91%) showed notable declines. The digital content sector's drop is attributed to declines in gaming-related stocks, particularly Pearl Abyss (-23.67%). It is speculated that the sell-off follows the company's weaker-than-expected sales.

Among the top market capitalization stocks in KOSDAQ, all are down except Celltrion Healthcare (0.49%) and Celltrion Pharm (2.28%). Following Pearl Abyss, Kakao Games fell 4.36%. Other decliners include Cheonbo (-2.35%), L&F (-2.25%), CJ ENM (-2.23%), L&F (-1.65%), and HLB (-1.50%).

The securities industry advised against panic selling in a declining market. Ji-young Han, a researcher at Kiwoom Securities, said, "Although the recent market requires overall risk management, the stock market crash centered on the U.S. since late last week has the characteristics of panic selling," adding, "It is advisable to avoid joining the sell-off at this point."