Foreigners and Institutions Net Buyers... KOSPI Holds Above 3000 Despite Tightening Concerns

[Image source=Yonhap News]

[Asia Economy Reporter Minji Lee] The KOSPI closed higher. While the Nasdaq index plunged amid market concerns that major countries' tightening clocks would accelerate, the KOSPI was analyzed to have interpreted this as a factor resolving market uncertainty.

On the 17th, the KOSPI closed at 3,017.73, up 0.38% (11.21 points) from the previous trading day. The KOSPI started the day down 0.71% (21.21 points) at 2,985.20, fluctuated between gains and losses during the session, and closed higher due to foreign investors' buying momentum. On this day, foreign investors and institutions bought stocks worth 505.2 billion KRW and 6.8 billion KRW respectively, while individuals sold stocks worth 521.2 billion KRW alone.

Lee Kyung-min, a researcher at Daishin Securities, explained, "The easing of uncertainty and recovery of investment sentiment due to a clearer schedule of the Federal Reserve's monetary policy are expected to remain effective for the time being," adding, "Based on this, the global stock market relief rally is likely to continue, and in the short term, the KOSPI will attempt to rebound to the 3,050 level."

However, it is predicted that the removal of policy uncertainty from major central banks alone will not trigger a trend reversal in the market. Supply chain bottlenecks are still ongoing, and concerns about the resurgence of COVID-19 remain. The mismatch phase between the economy and monetary policy is inevitable to continue for some time, and if the pace of improvement in stock market fundamentals falls short of expectations, the market could become more unstable than before. The researcher added, "If the gap between expectations and reality becomes apparent, a correction process in global stock markets including the U.S. will be inevitable," and "While the possibility of a relief rally remains open, it is necessary to maintain caution until the first quarter of next year."

In the stock market on this day, telecommunications and financial stocks, which highlighted year-end dividend appeal, showed strength. By sector, telecommunications (3.10%), steel & metals (2.48%), insurance (1.96%), and banking (1.44%) posted the largest gains. Major rising stocks included KakaoBank (1.27%), KB Financial Group (3.18%), Shinhan Financial Group (2.26%), SK Telecom (3.75%), Samsung Fire & Marine Insurance (1.89%), and KT (1.89%).

Among the top market capitalization stocks, Samsung Electronics closed up 0.26% at 78,000 KRW. On the other hand, SK Hynix (-1.61%), Samsung Biologics (-0.31%), NAVER (-0.77%), Kakao (-1.67%), and Samsung SDI (-0.44%) declined.

The KOSDAQ index closed at 1,001.62, down 0.65% (6.60 points) from the previous trading day. In the KOSDAQ market, individuals alone bought stocks worth 129.5 billion KRW, while foreign investors and institutions sold stocks worth 29.6 billion KRW and 101.2 billion KRW respectively. Among the top market capitalization stocks, Celltrion Healthcare (0.37%) and Celltrion Pharm (1.59%) rose, while EcoPro BM (-0.64%), Pearl Abyss (-3.22%), L&F (-3.57%), Kakao Games (-2.14%), and Wemade (-1.35%) declined.