KOSPI Closes Down Over 1%, Holds 2400 Level... Exchange Rate Surpasses 1390 Won (Comprehensive)

On the 14th, when the US stock market plummeted due to inflation fears, the won-dollar exchange rate and KOSPI were displayed in the dealing room of Hana Bank in Euljiro, Seoul. On that day, the exchange rate surpassed 1,390 won for the first time in 13 years and 5 months. Photo by Moon Honam munonam@

[Asia Economy Reporter Kwon Jaehee] The KOSPI index, which started with a decline in the 2% range due to inflation fears, narrowed its losses and closed down in the 1% range. On the same day, the exchange rate surpassed 1,390 won, setting a new high once again. Despite the soaring exchange rate causing foreigners to exit the Korean stock market again, individual investors are absorbing that volume and defending the index.

On the 14th, the KOSPI index closed at 2,411.42, down 1.56% (38.12 points) from the previous trading day. The index started the session at 2,390.47, down 2.41% (59.07 points) from the previous day, giving up the 2,400 level shortly after the opening, but it narrowed the losses during the morning session and reclaimed the 2,400 level.

By investor type, foreigners and institutions sold net amounts of 164.2 billion won and 239.6 billion won respectively, while individuals alone bought stocks worth 389.6 billion won, defending the index.

On the same day, the won-dollar exchange rate closed at 1,390.9 won, a sharp rise of 17.3 won from the previous day.

Among the top market capitalization stocks, all stocks except LG Energy Solution (0.30%) and Samsung SDI (1.99%) were down. These include Samsung Electronics (-2.24%), SK Hynix (-1.90%), Samsung Biologics (-1.55%), LG Chem (-0.30%), Samsung Electronics Preferred (-2.42%), Hyundai Motor (-1.00%), NAVER (-3.56%), and Kia (-1.23%).

By sector, all sectors declined except non-metallic minerals (1.42%) and paper and wood (0.27%). These include construction (-2.89%), services (-2.48%), insurance (-2.28%), steel and metals (-2.01%), electricity and gas (-1.95%), pharmaceuticals (-1.91%), textiles and apparel (-1.89%), and finance (-1.65%).

The KOSDAQ index closed at 782.93, down 1.74% (13.86 points) from the previous trading day. The index started the session at 775.93, down 2.62% (20.86 points) from the previous day.

By investor type, individuals again bought stocks worth 196.8 billion won alone. Foreigners and institutions sold net amounts of 5.5 billion won and 175.8 billion won respectively.

Among the top 10 market capitalization stocks, all stocks except L&F (0.43%) and EcoPro (7.09%) closed lower. These include Celltrion Healthcare (-5.41%), EcoPro BM (-1.29%), HLB (-11.05%), Kakao Games (-3.76%), Pearl Abyss (-3.48%), Celltrion Pharm (-5.61%), Alteogen (-5.18%), and Chunbo (-0.94%).

By sector, all sectors recorded declines except metals (1.11%) and paper and wood (0.74%). These include transportation equipment parts (-4.95%), other services (-3.26%), distribution (-3.20%), entertainment and culture (-2.74%), digital content (-2.72%), telecommunications equipment (-2.64%), broadcasting services (-2.51%), and other manufacturing (-2.44%).

Han Ji-young, a researcher at Kiwoom Securities, said, "After the August CPI announcement, the key issue is the interest rate decision and the strength of the hike at the September FOMC," adding, "Rather than immediately joining position changes, it is an appropriate strategy to adjust weights after observing the September FOMC results."

Han also said, "There is even a possibility of an 'ultra step' (a 100 basis point hike at once), which is stronger than a giant step, at the September FOMC," and analyzed, "As we enter the blackout period before next week's FOMC, when speeches are prohibited, it is impossible to receive the Fed's evaluation of this CPI result. Therefore, aggressive forecasts such as a 100 basis point hike are expected to cause market uncertainty until the FOMC."