KOSPI Hits Consecutive All-Time Highs with Securities Stocks Reaching Record Prices

Mirae Asset Daewoo Rises for 3 Consecutive Days
DB and Hanwha Hit New Highs for 2 Consecutive Days

[Asia Economy Reporter Song Hwajeong] As the KOSPI continues to hit record highs day after day, securities stocks that have reached new highs are also emerging one after another.

As of 9:20 a.m. on the 25th, the KOSPI Securities Industry Index rose 1.76% (33.91 points) from the previous day to 1963.55. With most securities stocks showing gains, Mirae Asset Daewoo recorded a 52-week high during the session. On this day, Mirae Asset Daewoo rose to 10,150 KRW intraday. Mirae Asset Daewoo has risen for three consecutive days, recovering the 10,000 KRW level for the first time since May 2018. DB Financial Investment, Hyundai Motor Securities, Hanwha Investment & Securities, Ebest Investment & Securities, and KTB Investment & Securities also recorded 52-week highs during the session. Among them, DB Financial Investment, Hanwha Investment & Securities, Ebest Investment & Securities, and KTB Investment & Securities renewed their highs for two consecutive days. On the previous day, Samsung Securities touched 40,750 KRW intraday, marking a 52-week high.

The strong performance of securities stocks is interpreted as a result of the KOSPI continuously hitting record highs and the ongoing bullish trend. On the 23rd, the KOSPI recovered the 2600 level and set a new all-time high, and it closed at 2617.76 the previous day, setting a new high again within a day. On this day, it started at 2637.34, up 0.75%, raising the intraday high. As the KOSPI continues its strength, investor deposit funds, which are standby funds for stock investment, are also flowing in, hitting record highs. Investor deposit funds surpassed 65 trillion KRW on the 18th, marking an all-time high.

Ji-young Kim, a researcher at Kyobo Securities, said, "With recent vaccine developments, the domestic economy is expected to escape the recession caused by COVID-19 next year and show a gradual upward trend. The abundant liquidity due to low interest rates is positive for investment sentiment in securities stocks." She added, "The steady inflow of individual funds into the stock market is resulting in higher average daily trading volumes compared to the past, leading to improved earnings for securities firms." Kim also noted, "The securities firms' third-quarter earnings exceeding market consensus have increased expectations for dividend yields based on 2020, which will also drive the rise in securities stock prices."

With a significant increase in stock market trading volume this year, securities firms have achieved better-than-expected strong results. Kiwoom Securities, NH Investment & Securities, Samsung Securities, KB Securities, Shinhan Investment Corp., and Hana Financial Investment all recorded their highest quarterly earnings ever in Q3. Mirae Asset Daewoo is expected to be the first in the industry to achieve a pre-tax profit of 1 trillion KRW this year. Up to the third quarter of this year, Mirae Asset Daewoo recorded an operating profit of 820 billion KRW, pre-tax net profit of 872.3 billion KRW, and net profit of 642.2 billion KRW. Heeyeon Lim, a researcher at Shinhan Investment Corp., forecasted, "The consolidated controlling shareholder net profit for this year is expected to increase by 19.7% compared to the same period last year to 788.9 billion KRW, and it will be the first domestic single securities firm to achieve a pre-tax profit of 1 trillion KRW."