The secondary battery-related stocks that surged sharply in the morning quickly gave up their gains in the afternoon, causing the entire market to fluctuate. This is interpreted as a side effect of the extreme concentration in secondary battery-related stocks.

According to the Korea Exchange on the 26th, EcoPro BM closed at 455,000 KRW, down 1.52% from the previous day.

Until 1 p.m. that day, EcoPro BM steadily expanded its gains. The stock price rose to 584,000 KRW, and its market capitalization exceeded 57 trillion KRW. In the domestic stock market, only four listed companies?Samsung Electronics, LG Energy Solution, SK Hynix, and POSCO Holdings?had a larger market capitalization than EcoPro BM.

EcoPro BM’s stock price, which closed at 249,000 KRW at the end of last month, rose more than 100% in one month, raising concerns about overheating due to the short-term surge. As selling pressure for profit-taking emerged, some of the gains were given back. The stock price fell to 428,500 KRW before 2 p.m. Within one hour, the stock price dropped 26.6% from its peak. The market capitalization shrank to 41.9 trillion KRW.

On that day, the short-selling transaction amount for EcoPro BM reached 413.3 billion KRW. The volume of short selling has been steadily increasing since the 18th. The average short-selling price was 512,340 KRW.

Not only EcoPro BM but also EcoPro’s stock price fell 26.2% from its peak within one hour. As the leading stocks among secondary battery-related shares, the rapid decline in EcoPro and EcoPro BM stock prices triggered panic selling in POSCO Holdings, POSCO Future M, and others.

The intraday price drop from the high to the low for POSCO Holdings and POSCO Future M reached 21.6% and 24.6%, respectively. It was an unusual rapid fluctuation for large-cap stocks with market capitalizations ranging from 40 trillion to 50 trillion KRW.

Among the top traded stocks in the domestic market, the top six?POSCO Holdings, EcoPro BM, EcoPro, POSCO Future M, POSCO International, and L&F?are all related to the secondary battery industry. POSCO Holdings recorded a trading volume of 7.983 trillion KRW in one day. The trading volumes for EcoPro BM and EcoPro were 5.5629 trillion KRW and 4.0963 trillion KRW, respectively.

The KOSDAQ index was influenced by the stock price movement of EcoPro BM. The index, which rose to 956.4 during the day, fell to 886.14 within an hour before barely maintaining the 900 level to close the session.

On that day, 88 companies in the KOSDAQ market rose, while 1,480 companies fell, with the majority of stocks declining. A total of 473 KOSDAQ-listed companies hit new 52-week lows. Although the index has steadily risen this year, about 30% of all listed companies saw their stock prices decline.

Researcher Kang Dae-seok of Yuanta Securities explained, "While other large-cap stocks remained quiet ahead of the US Big Tech earnings and the FOMC, the secondary battery sector surged in the domestic market, raising concerns about concentration again since March."

Researcher Kim Jong-young of IBK Investment & Securities analyzed, "Currently, momentum stocks have risen due to excessive preference by individual investors. If new capital inflows do not increase significantly, the performance superiority of momentum stocks will be difficult to sustain."