Delta Shock Triggers Foreigners' 'Withdrawal'... KOSDAQ Also Turns Downward

[Image source=Yonhap News]

[Asia Economy Reporter Ji Yeon-jin] On the 21st, the domestic stock market continues to be shocked by the spread of the COVID-19 Delta variant. The KOSPI, which opened higher, turned to a decline during the morning session as foreign investors sold off, and the decline widened in the afternoon, while the KOSDAQ also gave up its gains.

As of 2 p.m. on the day, the KOSPI index stood at 3,217.93, down 14.70 points (0.45%) from the previous day. Although individuals sold a net amount worth 673.1 billion KRW, foreign investors and institutions led the index decline by net selling amounts worth 411.9 billion KRW and 278.2 billion KRW, respectively.

Among the top 10 market capitalization stocks, only Hyundai Motor (+0.66%) and Kia (+0.23%) showed upward trends. Samsung Electronics (-0.51%), SK Hynix (-1.27%), Naver (-2.16%), Kakao (-4.28%), Samsung Biologics (-0.99%), LG Chem (-0.14%), and Celltrion (-1.10%) all fell consecutively as foreign investors poured out sell orders.

Lee Kyung-min, a researcher at Daishin Securities, explained, "Although the U.S. stock market showed a strong rebound last night, the domestic market, which performed relatively well the day before, showed weak rebound strength in the early session. News that the number of COVID-19 confirmed cases exceeded 1,700 in the early session, a slight decline centered on the Nasdaq in the U.S. futures market, and the won-dollar exchange rate rising to 1,151 KRW led to foreign investors and program sell orders emerging, causing a reversal to a decline."

At the same time, the KOSDAQ index was at 1,042.30, down 1.36 points (0.13%) from the previous day. While individuals bought a net amount worth 261.4 billion KRW, foreign investors and institutions sold net amounts worth 135.5 billion KRW and 118.8 billion KRW, respectively.

In the KOSDAQ market, Kakao Games rose 6.20% on expectations of significant earnings improvement due to the success of a new game, and SK Materials rose 6.72% on news of entering the secondary battery business. On the other hand, Pearl Abyss plunged 7.35% following news of the delay in the release of its new game Red Desert, and Celltrion Healthcare (-0.94%), EcoPro BM (-0.67%), Celltrion Pharm (-2.29%), and Seegene (-1.12%) also showed weakness.

Seo Sang-young, a researcher at Mirae Asset Securities, said, "Since the COVID-19 issue has not been completely resolved, it is insufficient to continue the rise," adding, "In the short term, stocks with high expectations for earnings improvement are showing strength."