Stock Market Trapped in a Box Range... KOSPI Ends Strongly with Late Rally

[Image source=Yonhap News]

[Asia Economy Reporter Ji Yeon-jin] The domestic stock market closed slightly higher on the 5th. Ahead of Samsung Electronics' first-quarter earnings announcement this week, a cautious stance deepened, resulting in a sideways market.

The KOSPI index closed at 2,759.20, up 1.30 points (0.05%) from the previous day. The index started slightly higher, then turned lower during the session, fluctuated around the flat line, and ended with a slight rebound just before the close.

Institutions sold heavily from early in the session, net selling 247.9 billion KRW and dragging the index down. Foreigners showed a selling bias throughout the day but recorded a net purchase of 11.6 billion KRW at the end, while individuals bought on dips, recording a net purchase of 238.8 billion KRW.

Samsung Electronics, which rose early in the session, turned lower during the day and closed slightly down (0.14%) at 69,200 KRW. SK Hynix remained flat.

Meanwhile, following news in the U.S. market the previous day that Tesla Chairman Elon Musk owns shares in Twitter, Tesla's stock price surged, leading to a concurrent rise in domestic secondary battery stocks.

LG Energy Solution rose 2.51%, and Samsung SDI also closed up 2.39%. LG Chem increased by 2.89%, recording the largest gain among large-cap stocks in the KOSPI market. NAVER (1.18%) and Kakao (1.90%) also showed upward trends.

By sector, the paper and wood sector recorded the largest gain of 2.26% due to a sharp rise in pulp prices, while the financial sector fell 1.24% amid concerns over narrowing short- and long-term interest rate spreads.

Park Kwang-nam, a researcher at Mirae Asset Securities, explained, "The KOSPI showed strength in internet and secondary battery sectors such as NAVER, Kakao, Samsung SDI, and LG Energy Solution, supported by the rise in U.S. tech stocks. However, financial stocks weakened due to concerns over shrinking loan-deposit margins caused by an inversion of the short- and long-term interest rate spread." He added, "Ahead of the earnings season, sector rotation without a clear direction is continuing."

The KOSDAQ index rose 5.11 points (0.54%) to 952.47. Individuals net sold about 64.8 billion KRW, while foreigners and institutions net bought 52.6 billion KRW and 17.8 billion KRW, respectively.

In the KOSDAQ market, gains were prominent mainly in the secondary battery and internet sectors. EcoPro BM surged 6.47%, and EcoPro jumped 12.89%. L&F showed a 4% gain early in the session but narrowed to close up only 0.17%.

Additionally, game stocks such as Pearl Abyss (1.54%), Kakao Games (0.89%), and Wemade (2.32%) closed higher. Celltrion Healthcare, which showed weakness during the session, rebounded to close slightly up (0.16%), while Celltrion Pharm closed slightly down (-0.10%).

Q Capital, Kumho HT, and U&I hit the daily upper limit. International Pharmaceuticals and Murim SP recorded intraday upper limits but gave back some gains to close up 18.17% and 19.06%, respectively.

On the other hand, United Pharm fell to the daily lower limit. Bridge Biotherapeutics, EN Plus, Mirae ING, Seojeon Electric, and KH E&T also recorded losses exceeding 10%.

Lee Jin-woo, head of investment strategy at Meritz Securities, said, "Recently, the market has been less influenced by the U.S. stock market. While macro issues have subsided, negative factors such as rising international oil prices persist, making company-specific issues important at this time."

Han Ji-young, a researcher at Kiwoom Securities, advised, "The strong foreign net selling amid high macro uncertainty has had a significant impact. After the earnings announcements of major companies such as Samsung Electronics and LG Electronics scheduled for this week, it is necessary to keep open the possibility of a rebound in large-cap stocks as earnings season expectations build."