KOSPI Recovers to 2380 Level as US CPI Slows... Exchange Rate Hits Lowest in Over 7 Months

KOSPI Closes at 2386.09, Up 0.89%
USD-KRW Exchange Rate Drops by 4.5 Won

[Asia Economy Reporter Lee Jung-yoon] The KOSPI closed higher for the eighth consecutive trading day, recovering to the 2380 level, driven by buying from foreigners and institutions. The slowdown in the U.S. December Consumer Price Index (CPI) led the upward trend.

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On the 13th, the KOSPI index closed at 2386.09, up 20.99 points (0.89%) from the previous trading day. The index opened at 2377.34, up 12.24 points (0.52%), and rose to as high as 2397.01, approaching the 2400 level, as foreigners and institutions maintained a buying advantage, but the gains narrowed afterward. While individuals sold a net amount worth approximately 780.4 billion KRW, foreigners and institutions bought net amounts of about 571.4 billion KRW and 215 billion KRW, respectively.

Among the top market capitalization stocks, Kia showed the largest gain at 2.19%. It was followed by Hyundai Motor (1.50%), LG Chem (1.10%), Kakao (0.81%), Naver (0.52%), Samsung Electronics (0.50%), and Samsung SDI (0.32%). SK Hynix fell 1.27%, while LG Energy Solution and Samsung Biologics remained flat.

By sector, most recorded gains except for Medical Precision (-1.03%), Pharmaceuticals (-0.10%), and Non-metallic Minerals (-0.03%). Transportation and Warehousing rose the most at 4.71%, followed by Steel & Metals (3.23%), Securities (2.70%), Finance (1.91%), Transportation Equipment (1.71%), and Machinery (1.49%).

Kim Seok-hwan, a researcher at Mirae Asset Securities, explained, "The domestic stock market started higher on relief from the U.S. CPI slowdown," adding, "However, as the Bank of Korea's Monetary Policy Committee announced a 25bp (1bp=0.01%p) rate hike during the session, the KOSPI showed strength led by gains in large-cap stocks."

The U.S. December CPI rose 6.5% year-on-year, the smallest increase in 12 months since October 2021. It fell 0.1% month-on-month. This was the first month-on-month CPI decline since May 2020. Core CPI, excluding volatile energy and food, rose 5.7% year-on-year and 0.3% month-on-month. With inflation easing, there is speculation that the Federal Reserve may reduce the rate hike to 0.25 percentage points at the February Federal Open Market Committee (FOMC) meeting.

On the same day, the won-dollar exchange rate fell 4.5 won from the previous closing price to 1241.3 won, marking the lowest level in about seven months.

The KOSDAQ index also closed higher, finishing at 711.82, up 1.00 point (0.14%) from the previous day. Although it declined during the session due to selling by foreigners and institutions, it turned upward again in the latter part of the day. Individuals were the sole net buyers with about 114.1 billion KRW, while foreigners and institutions sold net amounts of approximately 72.5 billion KRW and 38.8 billion KRW, respectively.

Among the top market capitalization stocks, Celltrion Healthcare rose 1.01%, HLB 0.79%, and Pearl Abyss 0.23%. Conversely, Rino Industrial fell 1.18%, EcoPro 0.86%, L&F 0.85%, EcoPro BM 0.40%, and Celltrion Pharm 0.15%. Studio Dragon and Kakao Games remained flat.