Concerns Over Economic Slowdown Highlighted... KOSDAQ Falls Over 1%

Individual Investors Sell on KOSPI, Net Buy Over 300 Billion KRW on KOSDAQ

[Image source=Yonhap News]

[Asia Economy Reporter Ji Yeon-jin] On the 13th, the domestic stock market is showing weakness. Concerns about economic slowdown in major countries such as the United States and China have been highlighted, and it is analyzed that cautious sentiment has deepened ahead of the long Chuseok holiday.

The KOSPI index was at 3,117.76 as of 1:48 PM, down 8 points (0.26%) from the previous trading day. After opening at 3,117.35, the KOSPI has seen a tight battle as foreign investors and institutions absorbed the selling volume from individuals. At this time, individuals have net sold about 135.8 billion KRW, while foreigners and institutions have net bought approximately 80.3 billion KRW and 61 billion KRW, respectively.

Among the top market capitalization stocks, Samsung Electronics (0.80%) and SK Hynix (1.48%) are on the rise, while most others are declining. Kakao fell 5.38%, and KakaoBank also dropped 5.22%. Celltrion is also recording a decline in the 2% range. LG Chem is steady.

In particular, in the KOSPI market, steel and energy chemical stocks such as POSCO (3.89%), Korea Zinc (3.94%), Lotte Chemical (3.62%), and Hanwha Solutions (3.92%) are showing strong performance. Kim Sung-no, a researcher at BNK Investment & Securities, said, "Since a top-down momentum slowdown may be accompanied by a bottom-up momentum weakening, it is difficult to expect a large price increase," adding, "Interest in small and mid-cap stocks is expected to grow, and considering earnings, valuation, and dividends comprehensively, banks, steel, and telecommunications are relatively attractive sectors."

At the same time, the KOSDAQ is trading at 1,026.43, down more than 1% (1.11%, 11.48 points) from the previous trading day. The KOSDAQ started trading at 1,036.86 today, and the decline is widening as selling volume from institutions and foreigners increases. While individuals have net bought about 355.3 billion KRW, foreigners and institutions are net selling approximately 144.1 billion KRW and 185.3 billion KRW, respectively.

LNf jumped more than 17% as its operating profit forecast was significantly raised, and EcoPro BM (1%), HL Biopharma (0.92%), and Seegene (0.32%) are showing slight gains. Celltrion Healthcare and Celltrion Pharm are down more than 2%, and Kakao Games also widened its decline, falling 2.71%.

Lee Kyung-min, a researcher at Daishin Securities, said, "This Chuseok holiday is relatively long at five days, and considering that the September U.S. Federal Open Market Committee (FOMC) meeting is scheduled right after the holiday, the tendency to avoid uncertainty may increase," adding, "Since 2010, the KOSPI has been sluggish during the week before the Chuseok holiday. The average weekly return was -0.47%, and it showed weakness 7 times out of 12 (58%), so it is a time to be cautious ahead of the Chuseok holiday."

Han Ji-young, a researcher at Kiwoom Securities, said, "The downward pressure on the stock market that could be caused by macro events scheduled this week is expected to be limited," but added, "However, since a long holiday is approaching next week, it is appropriate to prepare for increased price volatility caused by reduced trading and sudden changes in supply and demand due to deepening cautious sentiment from midweek onward."