Foreigners and Institutions "Buy" Boost KOSPI Rebound... LG Chem Rises 8%

On the 2nd, when the KOSPI index started with a sharp rise, the KOSPI was displayed on the electronic board in the dealing room of Hana Bank in Euljiro, Seoul. Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Ji Yeon-jin] On the 2nd, the domestic stock market rebounded sharply. As the previously rising U.S. Treasury yields showed signs of stabilization, net buying by foreign and institutional investors continued, driving the index higher. Individual investors, who bought more than 3 trillion won during the KOSPI decline on the 26th of last month, took profits on this day.

The KOSPI index was trading at 3,082.17 at 10:27 a.m., up 67.75 points (2.25%) from the previous close. The KOSPI started trading at 3,021.68 and at one point during the session rose to the 3,095 level before settling around the 3,080 level. While individuals sold a net 934 billion won, foreigners and institutions bought 473.8 billion won and 476.1 billion won, respectively.

Most of the top market cap stocks in KOSPI, including Samsung Electronics (+2.42%), were on the rise. In particular, a rosy outlook for the eco-friendly electric vehicle market, which had previously raised concerns in the market, led to strength in electric vehicle battery-related stocks. LG Chem jumped 7.46% from the previous close, and Hyundai Motor, expected to see strong sales of the Ioniq 5, rose more than 4%. Kia Motors also rose about 3%.

The secondary battery sector's stock prices fell an average of 11% over the past two weeks. Unfavorable factors across the electric vehicle, cell, and materials sectors are believed to have dampened investor sentiment. However, news that electric vehicle battery usage has surged this year has raised growth prospects for the electric vehicle market. Kim Kwang-jin, a researcher at Yuanta Securities, said, "Noise related to lawsuits and fires is expected to be resolved by April at the latest, and as the rapid upward trend in major metal prices and freight indices has recently shown some slowdown, we anticipate entering a moderate upward phase going forward."

At the same time, the KOSDAQ index was trading at 930.53, up 16.59 points (1.82%). Individuals sold a net 33.8 billion won, while foreigners and institutions bought 450 billion won and 464.1 billion won, respectively.

Among the top 10 market cap stocks, only Kakao Games (-2.04%) showed a decline, while the rest were rising. In particular, SK Materials, a semiconductor parts affiliate of SK, surged 5%, and online game company Pearl Abyss rose 2.80%, outperforming the index's gain. Celltrion Healthcare (0.88%) and Celltrion Pharm (0.78%) showed slight increases, and HL Biopharma (3.21%) showed strength.

Lee Jin-woo, head of investment strategy at Meritz Securities, analyzed, "This is a typical retracement phenomenon due to the stabilization of U.S. Treasury yields. Individual investors bought at low prices during last week's correction, and as stock prices rose today, they seem to be realizing profits for short-term investments." Lee Kyung-min, head of investment strategy at Daishin Securities, also said, "Although U.S. economic indicators were announced to have improved, the downward stabilization of Treasury yields has led the domestic stock market to show a strong upward trend," adding, "The domestic market seems to be releasing the pent-up upward momentum that had been suppressed."