Powell's 'Dovish' Remarks Drive KOSPI Up for 3 Consecutive Days... Closes Just Below 2480

Breaking Through the 2500 Mark Intraday After 3 Months

[Image source=Yonhap News]

[Asia Economy Reporter Myung-hwan Lee] On the 1st, the KOSPI continued its three-day winning streak following remarks by Jerome Powell, Chairman of the U.S. Federal Reserve (Fed), suggesting a slowdown in the pace of interest rate hikes. However, the index gave back gains in the afternoon amid news of declining domestic exports and uncertain economic outlooks.

On the day, the KOSPI closed at 2,479.84, up 0.30% (7.31 points) from the previous trading day. The KOSPI opened at 2,501.43, up 1.17% (28.90 points) from the previous day, marking the first time it surpassed the 2,500 mark during intraday trading since August 19, about three months ago. However, it ended the session with modest gains after giving back some of the earlier rise in the afternoon.

Seok-hwan Kim, a researcher at Mirae Asset Securities, analyzed, "Ahead of the December Federal Open Market Committee (FOMC) meeting, Powell’s remarks in his last public appearance were interpreted as 'dovish,' strengthening risk asset preference sentiment. However, profit-taking following recent gains and an uncertain economic outlook led to a reduction in the decline."

News that domestic exports recorded a negative growth for two consecutive months also appeared to dampen the index’s upward momentum. The Ministry of Trade, Industry and Energy announced that November exports totaled $51.91 billion, down 14.0% from the same month last year ($60.33 billion). This marks a decline in export value for two consecutive months following October. The trade balance also recorded a deficit of $7.01 billion (approximately 9.1 trillion KRW).

Foreign investors, who had been large-scale buyers during the morning session on the KOSPI, reduced their buying intensity, slowing the index’s rise. On the day, foreigners purchased stocks worth 32.9 billion KRW. Institutions net bought 225.2 billion KRW, while individuals sold 276.3 billion KRW, engaging in profit-taking.

Among the top market capitalization stocks, gains narrowed or reversed to losses in the afternoon. Samsung Electronics closed at 62,600 KRW, up 0.64% (400 KRW) from the previous day, and its preferred shares, Samsung Electronics Preferred, ended at 56,200 KRW, up 0.54% (300 KRW). Hyundai Motor (1.48%) and NAVER (0.27%) also closed higher. Conversely, secondary battery-related stocks such as LG Chem (-2.43%), Samsung SDI (-0.41%), and LG Energy Solution (-0.34%) closed lower.

By sector, the construction industry index rose 2.20% from the previous day, with securities (2.09%), small-cap stocks (1.40%), and textiles/apparel (1.36%) also gaining. Meanwhile, medical precision (-1.56%) and chemicals (-0.64%) declined.

The KOSDAQ index closed at 740.60, up 1.52% (11.06 points) from the previous day. It opened at 740.97, up 1.57% (11.43 points), and maintained its gains throughout the session.

In the KOSDAQ market, individual selling was prominent. Individuals net sold 371.3 billion KRW, while institutions and foreign investors purchased 242.2 billion KRW and 148.5 billion KRW, respectively.

Most of the top market capitalization stocks on the KOSDAQ closed higher. Pearl Abyss closed at 44,850 KRW, up 3.10% (1,350 KRW), and Rino Industrial also rose 3.09% (5,300 KRW) to 176,800 KRW. Cheonbo (2.57%), HLB (2.00%), and L&F (1.77%) also closed with gains exceeding 1%. Only Kakao Games closed slightly lower, down 0.57% (250 KRW) from the previous day.

By sector on the KOSDAQ, the construction index led gains with a 3.82% rise, followed by entertainment and culture (3.19%) and other services (2.53%). Paper/wood (-0.47%) and broadcasting services (-0.39%) closed slightly lower.