Four Witches Day... KOSPI Foreign Investors Sell Over 1 Trillion Won, Closing Down at 2740 Level

[Image source=Yonhap News]

[Asia Economy Reporter Park Jihwan] This year's last 'Four Witching Hours' saw the KOSPI close lower due to large-scale selling by foreign investors amounting to over 1 trillion won.

On the 10th, the KOSPI closed at 2,746.46, down 9.01 points (0.33%) from the previous trading day. The index opened at 2,750.34, down 5.13 points (0.19%), managed to rebound in the afternoon, but turned downward again near the close.

By investor type, individuals and institutions net bought 891.3 billion won and 442.6 billion won respectively, while foreigners sold off 1.3612 trillion won.

Among the top 10 stocks by market capitalization, all declined except Celltrion (1.84%) and Kia Motors (0.16%).

On the same day, the KOSDAQ index closed at 921.70, up 7.89 points (0.86%) from the previous day. Individuals net bought 145.7 billion won, while foreigners and institutions net sold 4.6 billion won and 71.1 billion won respectively.

Among the top market capitalization stocks, most rose except Kakao Games (-3.37%).

So far this year, the four 'Four Witching Hours' days have shown three bearish sessions and one bullish session. On March 12, coinciding with the full-scale spread of the novel coronavirus (COVID-19), the KOSPI fell 3.87% and the KOSDAQ dropped 5.39%. On June 11, the KOSPI declined 0.86% and the KOSDAQ 0.21%. On September 10, the KOSPI rose 0.87% and the KOSDAQ 1.71%.

'Four Witching Hours' refers to the day when four types of derivatives?index futures, index options, individual stock options, and individual stock futures?expire simultaneously. In Korea, this occurs on the second Thursday of March, June, September, and December each year. It is common in the market for a surge of closing trades near the end of the session to cause overall market volatility and a decline.