KOSPI Closes Up 1%... "KOSPI Supply-Demand Environment Favorable for Large-Cap Stocks"

Banking, Securities, and Insurance Sectors Show Strength
KOSDAQ Closes Higher... Additional Fluctuations Possible

[Image source=Yonhap News]

[Asia Economy Reporter Gong Byung-sun] The KOSPI closed the session up 1%. Despite various factors such as U.S. Treasury Secretary Janet Yellen hinting at interest rate hikes, it appears that fundamentals drove the rise.

On the 6th, the KOSPI closed at 3,178.74, up 1.00% (31.37 points) from the previous trading day. Although it dropped to 3,133.64 early in the session, it later showed an upward trend.

The KOSPI index rose supported by fundamentals. Lee Kyung-min, a researcher at Daishin Securities, explained, “The global competitiveness of domestic companies has strengthened,” adding, “Structural changes will lead to an expansion in corporate valuation, and the KOSPI supply-demand environment is also favorable for large-cap stocks.”

Institutional buying led the index's rise. Institutions net purchased 201.8 billion KRW. Individuals and foreigners net purchased 91.3 billion KRW and 100.6 billion KRW, respectively.

Almost all sectors rose. The banking sector had the largest increase at 6.53%, followed by transportation and warehousing (5.53%), steel and metals (5.40%), securities (3.78%), and insurance (3.65%). The electrical and electronics sector (-0.67%) and transportation equipment (-0.19%) declined.

Many of the top 10 market capitalization stocks declined. Celltrion had the largest drop at -2.88%, followed by SK Hynix (-2.27%), Samsung SDI (-1.23%), NAVER (-0.82%), Kakao (-0.43%), and Samsung Electronics (-0.36%). POSCO (5.05%), Samsung Biologics (2.49%), and LG Chem (1.96%) rose. Hyundai Motor remained flat.

The KOSDAQ closed at 969.99, up 0.29% (2.79 points) from the previous trading day. The index fluctuated throughout the day but turned upward at 2:28 PM.

Although volatility remains, it is expected to hold the 900-point level. Choi Yoo-jun, a researcher at Shinhan Financial Investment, said, “Considering that it took about 20 trading days for the stock price to recover after the resumption of short selling in the past, further volatility is possible. However, since the 900-point level was maintained even when interest rate volatility peaked last March, it should be recognized as a support level that does not disrupt the trend.”

Individual buying was strong. Individuals net purchased 266.8 billion KRW. Foreigners and institutions net sold 203.3 billion KRW and 64.9 billion KRW, respectively.

Most sectors rose. The metals sector had the largest increase at 3.15%, followed by transportation (2.40%), textiles and apparel (2.40%), finance (2.36%), and broadcasting services (2.26%). Retail (-0.76%), entertainment and culture (-0.56%), digital content (-0.50%), paper and wood (-0.44%), and pharmaceuticals (-0.26%) declined.

Many of the top 10 market capitalization stocks showed weakness. Celltrion Pharm’s decline was the largest at -2.08%, followed by Celltrion Healthcare (-1.91%), Studio Dragon (-1.71%), HL Biopharma (-1.51%), Kakao Games (-1.13%), and Alteogen (-1.03%). CJ ENM (3.61%), EcoPro BM (1.40%), Pearl Abyss (0.18%), and SK Materials (0.09%) rose.