KOSPI Rises 7% in the New Year... Is Investor Sentiment Reviving?

[Asia Economy Reporter Son Sunhee] Since the beginning of the Year of the Rabbit (Gyemyo Year), the KOSPI index has risen by more than 7%. A bullish market unfolded as funds poured in, mainly from foreign investors at the start of the year.

According to the Korea Exchange on the 23rd, the KOSPI closed at 2395.26 on the 20th, just before the Lunar New Year holiday. This is a 7.10% increase from the index at the end of last year (2236.40).

The recent strength in the KOSPI is attributed to improved investor sentiment as the steep inflation in the United States last year has somewhat eased. Additionally, China's economic reopening movement also contributed to creating a favorable atmosphere.

In particular, foreign investors showed strong buying momentum in the KOSPI market. Since the beginning of this year until the 20th (15 trading days), foreign investors have net purchased 4.27 trillion KRW worth of securities in the KOSPI market alone, driving the index upward.

The leading stock that attracted the most investment funds, Samsung Electronics, saw its stock price rise 11.75% in just 15 trading days, from 55,300 KRW at the end of last year to 61,800 KRW on the 20th. Its market capitalization increased by 38.8 trillion KRW to 368.93 trillion KRW. The second-largest market cap, LG Energy Solution, rose 7.81%, and the third, SK Hynix, increased by 16.8%.

Growth stocks that struggled last year, such as NAVER, rose 10.42% to 196,000 KRW, and Kakao closed at 61,200 KRW, up 15.25% since the start of the year.

During this period, Shinhan Financial Group showed the highest stock price increase among the top 20 by market capitalization, rising 23.01%. Hana Financial Group also rose 22.47%, and KB Financial Group increased by 17.53%. These gains are interpreted as reflecting expectations of improved earnings due to interest rate hikes, dividend expansions, and loan expansions following the easing of real estate policies.

During the same period, the KOSDAQ index rose from 679.29 to 717.97, an increase of 5.69%. Although it also showed an upward trend, the increase was smaller than that of the KOSPI.