Foreign and Institutional Selling Continues
Individuals Net Buy 2.566 Trillion Won
KOSDAQ Also Closes Lower but Holds Above 900
On November 5, the KOSPI index fluctuated due to heavy selling by foreign investors, dropping as low as the 3,800 level during the session, but managed to hold above 4,000 thanks to buying by individual investors.
On November 5, the KOSPI closed at 4,004.42, down 117.32 points (2.85%) from the previous day. The index opened at 4,055.47, down 66.27 points (1.61%), and plummeted to below 3,867.81 during trading. This marks a drop to the 3,800 range just seven trading days after the index surpassed the 4,000 mark for the first time ever during intraday trading on October 27. The sidecar (temporary halt of program trading) was triggered for the first time in seven months since April 7. The sidecar is activated when the KOSPI 200 futures index rises or falls by more than 5% and stays at that level for one minute.
Foreign investors, who had previously driven the KOSPI's rally, sold a massive 2.5183 trillion won worth of shares. Institutions also sold 79.4 billion won. In contrast, individual investors bought 2.565 trillion won, helping to reduce the losses.
On the 5th, when the KOSPI sharply dropped, a dealer is working in the dealing room at the headquarters of Hana Bank in Jung-gu, Seoul. Photo by Yonhap News Agency
Among the top market cap stocks, only NAVER rose (4.31%). In contrast, most stocks saw significant declines, including Hanwha Ocean (-7.47%), HD Hyundai Heavy Industries (-6.88%), Doosan Enerbility (-6.59%), HD Korea Shipbuilding & Offshore Engineering (-6.34%), Hanwha Aerospace (-5.94%), HD Hyundai Electric (-5.45%), SK Square (-5.11%), Samsung Electronics Preferred (-4.88%), Samsung Electronics (-4.10%), Kia (-2.97%), and Hyundai Motor (-2.72%).
By industry, only insurance (1.49%) and telecommunications (0.83%) rose. Most sectors were weak, including machinery and equipment (-5.56%), transportation equipment and parts (-4.96%), construction (-3.72%), chemicals (-3.50%), manufacturing (-3.22%), metals (-3.18%), medical precision instruments (-3.06%), electricity and gas (-3.03%), and electrical and electronics (-3.01%).
The KOSDAQ index closed at 901.89, down 24.68 points (2.66%) from the previous day. The index opened at 919.28, down 7.29 points (0.79%), plunged to the 870 range during the session, but rebounded toward the close to recover the 900 level. Foreign investors sold 597.5 billion won. Institutions and individuals bought 42.2 billion won and 564.5 billion won, respectively.
Among the top market cap stocks, D&D Pharmatech (6.31%) and HLB (1.49%) rose. In contrast, most stocks declined, including Robotis (-9.85%), Rainbow Robotics (-7.38%), EO Technics (-6.98%), ABL Bio (-6.65%), Lino Industrial (-5.94%), Voronoi (-5.25%), PharmaResearch (-4.87%), Kolon TissueGene (-4.50%), and Alteogen (-3.64%).
Lim Jeongeun, a researcher at KB Securities, said, "The decline in semiconductor stocks, which had led the recent record-breaking rally, widened, and the index moved in tandem with large-scale foreign selling. However, after touching the 20-day moving average (3,871 points), which is considered a psychological support level, a tug-of-war ensued between foreign selling and individual buying. As a result, the KOSPI index recovered more than half of its losses and managed to defend the 4,000-point level."
She added, "While achieving the meaningful milestone of surpassing 4,000 points, the market now faces valuation controversy (stock price relative to corporate value) amid the domestic and global earnings season. In addition, expectations for further interest rate cuts by the US Federal Reserve have weakened, and the momentum from the '2025 Asia-Pacific Economic Cooperation (APEC) Summit' has also faded."
However, she downplayed the possibility of a prolonged correction. Lim said, "The Korean stock market remains in a strong bull phase. Given the sharp gains so far, a correction was inevitable, but it is likely to be short-lived."
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