[MarketING] KOSPI Falls to 2280 Level, Lowest in Two Months

Financial Stocks Fall One After Another Due to Ex-Dividend Impact
Secondary Battery Stocks Also Plunge Sharply Amid Tesla's Sudden Drop

[Image source=Yonhap News]

[Asia Economy Reporter Song Hwajeong] The KOSPI slipped to the 2280 level due to the impact of ex-dividend and weakness in electric vehicle-related stocks. It fell to its lowest level in two months since the end of October.

Financial Stocks Hit by Ex-Dividend, Secondary Battery Stocks Affected by Tesla

On the 28th, financial stocks and secondary battery stocks sharply declined, pulling the index down to the 2280 level.

On this day’s market, financial stocks such as KB Financial (-3.98%), Shinhan Financial Group (-4.52%), Hana Financial Group (-6.95%), Woori Financial Group (-9.23%), Industrial Bank of Korea (-10.71%), DGB Financial Group (-8.64%), BNK Financial Group (-8.29%), Samsung Securities (-8.01%), Samsung Card (-7.96%), and NH Investment & Securities (-7.33%) fell sharply. This decline in financial stocks was due to the ex-dividend effect. Banks and securities firms are representative dividend stocks. Generally, investors must hold stocks until the day before the ex-dividend date to receive dividends, so buying pressure flows into high-dividend stocks until the day before the ex-dividend date, but on the ex-dividend day, investors turn to selling, resulting in a supply of shares. Institutions that had recently maintained buying pressure for dividend gains turned to selling immediately on the ex-dividend day.

Secondary battery stocks also fell sharply due to Tesla’s plunge. On the 27th (local time), Tesla closed at $109.10, down 11.41% from the previous session in the New York market, following news of production suspension at its Shanghai plant. According to foreign media, Tesla halted automobile production at its Shanghai plant starting from the 24th. This was an extension of one day beyond the original plan and was considered unusual, raising concerns about a decline in Tesla electric vehicle demand, which negatively affected the stock price. As a result, on the Korea Exchange, LG Chem closed down 4.14% at 602,000 KRW, and LG Energy Solution and Samsung SDI also fell 4.49% and 3.37%, respectively. On the KOSDAQ market, Cheonbo (-10.71%), L&F (-7.45%), and EcoPro BM (-5.82%) all showed weakness.

Kim Seokhwan, a researcher at Mirae Asset Securities, analyzed, "The sharp decline in electric vehicle stocks in the US market led to an expanded drop in large secondary battery stocks, and the ex-dividend day triggered selling pressure from institutions and foreigners on high-dividend financial stocks and large-cap stocks, which weighed on the index. Concerns about weak electric vehicle demand are expected to lead to a contraction in secondary battery demand, dampening overall sector investment sentiment."

KOSPI Falls to 2280 Level, KOSDAQ Drops Below 700

The KOSPI dropped to the 2280 level for the first time in two months, and the KOSDAQ fell below 700 in just one day.

The KOSPI closed at 2280.45, down 52.34 points (2.24%) from the previous day.

Institutions and foreigners sold net amounts of 828.6 billion KRW and 310.2 billion KRW, respectively, pulling the index down. In contrast, individuals, who had been selling until the previous day to avoid major shareholder requirements, turned to buying and purchased 1.077 trillion KRW.

Among the top market capitalization stocks, most closed lower, including Samsung Electronics (-2.58%), SK Hynix (-1.30%), Hyundai Motor (-2.53%), and Kia (-4.99%). Only Samsung Biologics (0.24%) among the top 10 market cap stocks rose.

By sector, high-dividend sectors such as telecommunications (-4.37%) and finance (-3.69%) showed sharp declines, while medical precision (2.87%), electrical and electronics (-2.70%), transportation and warehousing (-2.32%), manufacturing (-2.22%), construction (-2.20%), and transportation equipment (-2.13%) also fell more than 2%.

The KOSDAQ closed at 692.37, down 11.82 points (1.68%) from the previous session. On the KOSDAQ market, institutions and foreigners sold net amounts of 367.5 billion KRW and 215.5 billion KRW, respectively, while individuals bought net 214.1 billion KRW.