'US Inflation Fear' Eases... Steel and Financial Inflation-Defensive Stocks Rally

[Asia Economy Reporter Ji Yeon-jin] On the 11th, the domestic stock market is showing a downward trend due to concerns over monetary tightening following a sharp rise in U.S. inflation. However, in the KOSPI market, foreign investors have continued a three-day consecutive net buying rally, reviving individual investor sentiment and reducing the decline.

The KOSPI index was trading at 2,758.10, down 13.83 points (0.50%) from the previous day as of 1:30 PM. The index, which started the day down more than 1%, was pushed down to the 2,730 level during the session due to institutional selling pressure, but the decline narrowed as individuals bought shares after confirming foreign buying early in the session.

At this time, institutions are net selling about 278.2 billion KRW, pulling the index down. However, individuals are defending by net buying about 144.9 billion KRW, and foreigners are net buying about 124.3 billion KRW. Foreigners have been net buyers in the KOSPI market for three consecutive days since the 9th. Seo Sang-young, a researcher at Mirae Asset Securities, said, "The U.S. stock market's decline due to concerns over the Fed's aggressive monetary policy following high consumer price index is a burden on the Korean stock market," but added, "Foreigners' supply and demand will determine the direction of the index."

The KOSDAQ index is down 10.13 points (0.13%) at 885.55. Foreigners have net sold about 129.5 billion KRW, and institutions have also sold about 79.8 billion KRW. Individuals are net buying about 202.1 billion KRW.

Kakao surged 5.96% in the afternoon after announcing a shareholder return policy including a share buyback the previous day, recording the steepest rise among the top market capitalization stocks on the KOSPI. SK Hynix, which saw concentrated foreign buying, rose 1.54%, and Samsung Electronics (-0.27%) reduced its losses. LG Energy Solution (0.74%) succeeded in rebounding after four days.

Inflation-defensive stocks are also showing an upward trend due to concerns over U.S. inflation indicators. Steel stocks including POSCO (4.11%) and financial stocks are strong. Hana Financial Group is soaring more than 5% today amid analysis that it is an undervalued bank stock.

However, game stocks that recently disclosed earnings shocks are sharply declining. Krafton fell more than 12% in the KOSPI market, and in the KOSDAQ, Wemade, which hit the lower limit price the previous day, is falling more than 7% again today.

KOSDAQ secondary battery parts stocks showed mixed results. EcoPro BM is up 7.5%, while L&F is recording a decline of more than 4%.

Additionally, Taeyang Metal hit the upper limit price on news of supplying to Tesla, while AD Chips and Leaders Cosmetics fell to the price limit (30%) due to a notice of designation as management stocks. Kim Yeon-jin, a researcher at Eugene Investment & Securities, said, "The market's primary focus is whether the U.S. Federal Open Market Committee (FOMC) in March will raise interest rates. Given the high U.S. consumer prices in February due to rising energy prices and labor costs, it seems difficult for inflation to slow significantly. A rate hike at the March FOMC is inevitable, and debates over the size of the hike will continue until the meeting."