KOSPI Falls Over 0.6% as Foreigners Engage in 'Profit-Taking'

Foreigners' Net Selling of KOSPI Stocks Worth 300 Billion KRW
"Caution Ahead of January US PCE Inflation Data Release" Analysis

Despite the rise in the US stock market the previous day, the KOSPI ended the session with a decline of around 0.6%. This was due to shrinking investor sentiment, mainly among foreigners, amid growing concerns over inflation.

[Image source=Yonhap News]

On the 24th, the KOSPI closed at 2,423.61, down 0.63% (15.48 points) from the previous trading day. The index initially showed an upward trend in the early session but widened its losses in the afternoon. Looking at investor trends, foreign investors sold stocks worth 300.6 billion KRW, and institutions also net sold stocks worth 97.3 billion KRW. Individuals were the only buyers, purchasing stocks worth 364.5 billion KRW.

The KOSPI showed a downward trend due to a flood of profit-taking sales by foreign investors. Although the index rose early in the session influenced by the US stock market gains, caution ahead of the US January PCE inflation data to be released tonight appears to have triggered net selling by foreigners. Lee Kyung-min, a researcher at Daishin Securities, said, “Concerns that the Federal Reserve’s monetary policy consensus could change depending on the inflation report results led to a contraction in investor sentiment,” adding, “The market expects the pace of easing in the PCE inflation rate compared to last month to slow, resulting in a rise in the dollar and bond yields and increased stock market volatility.”

By sector, insurance (0.95%), electric and gas utilities (0.7%), and textiles and apparel (0.64%) showed the largest gains. Within the insurance sector, Hanwha General Insurance (3.4%), Hyundai Marine & Fire Insurance (3.2%), DB Insurance (1.9%), and Mirae Asset Life Insurance (1.7%) posted notable increases. Kim Seok-hwan, a researcher at Mirae Asset Securities, explained, “Investor sentiment improved due to strong earnings reports from non-life insurers driven by improved loss ratios.”

Among the top market capitalization stocks, Samsung Electronics (-1.1%), SK Hynix (-1.8%), Samsung Biologics (-0.7%), Samsung SDI (-0.1%), Hyundai Motor (-1.3%), NAVER (-2.5%), Kia (-1.4%), Kakao (-1.1%), and POSCO Holdings (-2.8%) declined, while LG Energy Solution (0.7%), LG Chem (0.1%), and Celltrion (0.2%) rose.

The KOSDAQ index closed at 778.88, down 4.4 points (0.56%) from the previous trading day. Investor trends showed that foreigners and institutions sold stocks worth 79.2 billion KRW and 66.8 billion KRW respectively, while individuals were net buyers with purchases totaling 161.6 billion KRW.

Among the top market capitalization stocks on KOSDAQ, Ecopro BM (2.6%), L&F (3%), and Chunbo (0.8%) rose, while Celltrion Healthcare (-0.9%), Ecopro (-0.2%), HLB (-4.9%), Kakao Games (-1.5%), Pearl Abyss (-2%), SM Entertainment (-4.1%), JYP Ent. (-4.1%), Osstem Implant (-2.4%), and Rino Industries (-1.8%) declined.