Korean Stock Market Extends Losses... KOSPI Down Over 3% on Foreign and Institutional Selling

Due to simultaneous selling by both foreign investors and institutions, the KOSPI is down more than 3% during trading hours. The KOSDAQ is also extending its losses, remaining weak in the 3% range. This increased market volatility follows the nomination of Kevin Warsh as the next Chair of the US Federal Reserve (Fed).

As of 11:20 a.m. on February 2, the KOSPI index is trading at 5,050.88, down 173.48 points (3.32%) from the previous trading day. The KOSPI opened at 5,122.62, a decrease of 101.7 points (1.95%), partially recovered some losses, but has been widening its decline again since 10 a.m. Foreign investors have net sold 1.7237 trillion won, and institutions have net sold 720.3 billion won, intensifying downward pressure. Meanwhile, individual investors have net bought 2.3228 trillion won.

Most sectors are showing weakness. Metals (-6.43%), securities (-4.98%), electrical and electronics (-3.85%), machinery and equipment (-3.58%), manufacturing (-3.52%), large-cap stocks (-3.47%), finance (-3.17%), and IT services (-3.10%) are experiencing significant declines. Transportation equipment and parts (-2.79%), distribution (-2.65%), telecommunications (-2.59%), and entertainment and culture (-2.55%) are also trending downward.

On the 2nd, KOSPI opened with a drop of over 2% in the early session. An employee is monitoring the stock market and exchange rates in the dealing room at the Hana Bank headquarters in Jung-gu, Seoul. Photo by Jo Yongjun

The majority of large-cap stocks are also weak. SK Square is down 8.77%, and SK Hynix has dropped 5.06%. Samsung Electronics Preferred (-3.88%), Hanwha Aerospace (-3.23%), Hyundai Motor (-3.30%), Samsung Electronics (-3.18%), Doosan Enerbility (-3.20%), Samsung Life Insurance (-3.03%), LG Energy Solution (-3.02%), and Samsung C&T (-3.15%) are also declining.

Lee Jaewon, a researcher at Shinhan Investment & Securities, stated, "The Korean stock market is declining due to the nomination of Kevin Warsh as Fed Chair and increased market volatility," adding, "Expectations for aggressive rate cuts have diminished as Warsh's past criticism of quantitative easing has come into focus."

At the same time, the KOSDAQ index is trading at 1,111.78, down 37.66 points (3.28%) from the previous trading day. The KOSDAQ opened at 1,128.57, a decrease of 20.87 points (1.82%), attempted a brief rebound, but soon fell again. In terms of trading volume, foreign investors have net bought 65.3 billion won, individuals have net bought 99.7 billion won, while institutions have sold 122.5 billion won.

Among the top KOSDAQ stocks by market capitalization, Caregen (-13.23%), Wonik IPS (-10.84%), and Lino Industrial (-10.20%) are experiencing sharp declines. Pharmaresearch (-7.39%), Robotis (-6.79%), Ecopro BM (-6.03%), Alteogen (-5.93%), Mezzion (-5.80%), Peptron (-5.56%), and Ligachem Bio (-5.42%) are also posting significant losses.