Domestic Stock Market Strength, the 'Top' Among Global Markets

2348.39 During Trading... KOSDAQ Surpasses 850
Individual Investors' Net Buying This Month Hits 1.2396 Trillion Won

[Asia Economy Reporters Song Hwajeong and Lee Minwoo] The KOSPI has hit its highest point of the year for three consecutive days. Leading the index rise driven by the 'Donghak Ants' who lifted the domestic stock market during the COVID-19 crash, it is showing the most remarkable growth rate among major global stock markets.

As of 9:50 a.m. on the 6th, the KOSPI recorded 2347.10, up 1.52% (35.24 points) from the previous day. During the session, it rose to 2348.39, marking the highest level since the intraday record of 2349.64 on October 1, 2018. The KOSDAQ index rose 0.71% (5.98 points) to 853.26, surpassing the 850 level during the session.

The KOSPI, which has risen for four consecutive days this month, has broken its yearly high for three consecutive days. The KOSDAQ index showed strong momentum by rising for nine consecutive trading days, consecutively breaking through the 810, 820, 830, and 840 levels. Compared to overseas markets, it is also showing a strong upward trend. Since the beginning of the year, the KOSPI and KOSDAQ have risen by 5.03% and 25.98%, respectively. During the same period, the U.S. Dow Jones Industrial Average, S&P 500, and Nasdaq showed changes of -6.32%, 1.91%, and 21.04%, respectively. The Shanghai Composite Index in China rose 10.15%, while Japan's Nikkei 225 fell 3.45%.

The strength of the domestic stock market has been led by individual investors. Individuals have been net buyers in the KOSPI market for six consecutive trading days recently. The net purchase amount in the KOSPI market this month until the previous day reached 1.2396 trillion KRW. In the KOSDAQ market, individuals bought stocks worth 8.4 billion KRW this month. Since the beginning of the year, net purchases amount to 35.4561 trillion KRW in KOSPI and 9.2846 trillion KRW in KOSDAQ. During the same period, foreigners sold 25.8331 trillion KRW and institutions sold 19.1302 trillion KRW, respectively.

Abundant liquidity due to policy support and expectations of economic recovery are cited as factors driving the index rise. It is expected that the bullish trend will continue for the time being, supported by these factors. Park Kihyun, head of the research center at Yuanta Securities, said, "With credit risk containment, abundant liquidity environment, and U.S. fiscal policies, concerns about economic downturn have eased, and based on this, a gradual upward trend is likely to continue for the time being. However, as the year-end approaches, policy momentum is expected to weaken, and if insufficient economic indicator recovery is confirmed, the upward momentum may slow down."