[Asia Economy Reporter Kwon Jaehee] The KOSPI index recorded another sharp decline on the 23rd, closing below the 2300 mark. This is the first time in over two months since July 6 (2292.01) that the KOSPI index has closed below 2300.
On this day, the KOSPI index closed at 2290.00, down 1.81% (42.31 points) from the previous trading day. The index opened at 2331.33, down 0.04% (0.98 points) from the previous day, and during the session, it dropped as low as 2285.71 but ultimately failed to recover above 2300 before closing. The closing price is the lowest since October 30, 2020 (2267.15). The decline was the largest since the 1st (-2.28%).
Simultaneous sell-offs by foreigners and institutions dragged the index down. Foreigners and institutions sold stocks worth 194.1 billion KRW and 250.9 billion KRW, respectively. In contrast, individuals bought stocks worth 431.1 billion KRW, absorbing the volume dumped by foreigners and institutions.
In the foreign exchange market on the same day, the won-dollar exchange rate closed at 1409.3 KRW per dollar, down 0.4 KRW from the previous close. The exchange rate rose to 1411.2 KRW at one point in the afternoon, negatively affecting foreign demand and supply.
The previous day, the U.S. Federal Reserve (Fed) implemented a giant step (a 0.75 percentage point increase in the benchmark interest rate at once) at the Federal Open Market Committee (FOMC) meeting, continuing the tightening trend of global central banks, which is interpreted as having frozen investor sentiment.
Additionally, when the 3-year government bond yield surpassed 4.2% annually in the Seoul bond market that morning, the Ministry of Economy and Finance stated, "We are closely monitoring the bond market situation and will implement market stabilization measures if necessary."
The market is focusing on the upcoming announcements next week, including the finalized U.S. Gross Domestic Product (GDP), China's Manufacturing Purchasing Managers' Index (PMI), Eurozone Consumer Price Index (CPI), and U.S. Personal Consumption Expenditures (PCE) price index.
Among the top 10 market capitalization stocks, only Samsung Electronics (0.18%) and NAVER (1.94%) closed higher. LG Energy Solution (-5.73%), SK Hynix (-2.91%), Samsung Biologics (-1.91%), LG Chem (-3.51%), Samsung SDI (-3.02%), Samsung Electronics Preferred (-0.30%), Hyundai Motor (-1.55%), and Kia (-2.02%) all declined.
By sector, telecommunications (1.48%), insurance (1.27%), and steel & metals (0.29%) rose, while transportation & warehousing (-4.01%), medical precision (-3.76%), chemicals (-3.73%), non-metallic minerals (-3.64%), machinery (-2.91%), construction (-2.64%), paper & wood (-2.60%), and distribution (-2.37%) fell.
The KOSDAQ index closed at 729.36, down 2.93% (22.05 points) from the previous trading day. The KOSDAQ opened at 749.87, down 0.20% (1.54 points).
By investor type, foreigners sold stocks worth 310.1 billion KRW, while individuals and institutions bought stocks worth 280.1 billion KRW and 36.6 billion KRW, respectively.
Among the top 10 market capitalization stocks on KOSDAQ, all except HLB (1.52%) closed lower. Celltrion Healthcare (-1.38%), EcoPro BM (-6.30%), L&F (-7.70%), Kakao Games (-2.50%), Pearl Abyss (-2.91%), EcoPro (-4.22%), Celltrion Pharm (-3.07%), JYP Ent. (-0.99%), and Alteogen (-4.71%) declined.
All sectors in the KOSDAQ market closed lower. General electric & electronics (-5.18%) had the largest decline, followed by IT components (-4.54%), paper & wood (-4.51%), food, beverage & tobacco (-4.51%), telecommunication services (-4.42%), digital content (-3.47%), and publishing & reproduction (-3.42%).
Seo Sangyoung, a researcher at Mirae Asset Securities, explained, "The main reason for the expanded decline in the Korean stock market is the absence of rebound buying amid won depreciation, a sharp rise in government bond yields, and weakened investor sentiment."
The daily trading volume on the KOSPI and KOSDAQ markets was 7.2822 trillion KRW and 6.4309 trillion KRW, respectively.
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