KOSPI Weakens Amid FOMC Caution, Samsung Electronics Earnings Release, and Foreign Selling

[Asia Economy Reporter Jang Hyowon] The KOSPI index closed lower as foreign investors sold off shares ahead of the U.S. Federal Open Market Committee (FOMC) meeting and following Samsung Electronics' earnings announcement.

On the 31st, the KOSPI index closed at 2425.08, down 25.39 points (1.04%) from the previous day.

The KOSPI index started the day slightly lower and declined due to cautious sentiment ahead of the U.S. FOMC meeting and foreign selling triggered by Samsung Electronics' earnings announcement. By investor type, institutions and individuals were net buyers of 158.4 billion KRW and 316.7 billion KRW respectively, while foreign investors were net sellers of 486.5 billion KRW, weighing on the index.

[Image source=Yonhap News]

On the same day, Samsung Electronics announced an earnings shock for the fourth quarter of last year. It also stated that there would be no artificial production cuts or investment reductions, which diminished expectations for a rebound in semiconductor prices, resulting in a weak market.

Most sectors were down. Due to Samsung Electronics' decline, the electrical and electronics sector fell 1.88%, financials -1.55%, steel and metals -1.35%, transportation and warehousing -1.02%, electric and gas utilities -1.05%, and manufacturing -1.04%. Conversely, non-metallic minerals rose 2.06%, textiles and apparel 1.5%, food and beverages 0.87%, and chemicals 0.44%.

Most of the large-cap stocks also declined. Samsung Electronics dropped 3.63%, SK Hynix -2.43%, Samsung Biologics -1.25%, Samsung SDI -0.29%, Hyundai Motor -1.76%, NAVER -2.17%, and Kakao -3.31%. Meanwhile, LG Energy Solution showed strength with a 2.16% gain, and LG Chem rose 1.02%.

The KOSDAQ index rose on the day. While foreign investors were net sellers in the KOSPI, they were net buyers in the KOSDAQ, driving the index higher. The KOSDAQ index closed at 740.49, up 1.87 points (0.25%) from the previous day.

Most of the large-cap KOSDAQ stocks showed weakness. EcoPro BM fell 3.48%, Celltrion Healthcare -1.55%, L&F -1.67%, Kakao Games -0.43%, HLB -1.46%, EcoPro -3.0%, and Pearl Abyss -0.33%.

Meanwhile, in the Seoul foreign exchange market, the KRW/USD exchange rate closed at 1231.9 KRW, up 0.37% (4.5 KRW) from the previous day.