The KOSPI index closed down 3.86 points (0.15%) at 2,520, despite concerns over the enforcement of tariffs by the United States. Early in the trading session, inflows of foreign and institutional investors centered around the transportation equipment sector showed an upward trend, but it reversed to net selling during the intraday session and finished lower. However, the defense and shipbuilding sectors, considered safe from tariffs, attracted demand, showing relatively good performance compared to global markets.
On the 4th, the KOSPI index recorded 2,528.92, down 3.86 points (0.15%) from the previous trading day. The index started at 2,522.20, down 10.58 points (0.42%) compared to the previous day, dropping to the early 2,510s before quickly changing direction and rising to the high 2,540s. However, it switched back to decline and finished trading at the 2,520 level.
Foreign and institutional investors net sold 192.2 billion won and 147.6 billion won worth of shares, respectively, dragging down the index. Foreign investors also sold 323.5 billion won worth in the KOSPI 200 futures market, continuing a streak of net selling for eight consecutive trading days. Individual investors net bought 206.5 billion won in spot trading, while net selling in futures reached 144.7 billion won.
Overnight, all three major indexes of the New York Stock Exchange showed declines exceeding 1% due to U.S. President Donald Trump's enforcement of tariffs. The manufacturing Purchasing Managers' Index (PMI) fell below market expectations, raising concerns about the economy. Accordingly, there were worries that it would adversely affect the domestic stock market that day.
However, following the domestic market's 3% drop on the previous trading day (Feb. 28), bargain-hunting inflows supported a bottoming out. On the same day, Japan's Nikkei 225 index fell 1.2%, Taiwan's TSEC index declined 0.7%, and Hong Kong's Hang Seng Index dropped 0.02%.
Lee Kyung-min, a researcher at Daishin Securities, noted, "The domestic stock market's relatively good performance against tariff concerns is due to the fact that the risks of tariffs were already factored in last Friday," adding, "By sectors, the defense and shipbuilding industries benefited from the tensions due to the Russia-Ukraine war and U.S. policy momentum, while the secondary battery sector, which could be affected by tariffs on Mexico and Canada, saw a repositioning downward."
Due to the impact of an 8% drop in NVIDIA, one of the top market-cap stocks in the securities market overnight, SK hynix closed lower. With the enforcement of tariffs by President Trump, concerns over supply chain disruptions increased, leading to weak performances from secondary battery-related stocks such as LG Energy Solution, Samsung SDI, and POSCO FUTURE M.
As Wang Yi, China's Minister of Foreign Affairs, effectively canceled his visit to South Korea, shares of companies listed on the securities market that had risen on expectations of lifting the ban on Chinese imports, such as HYBE, NCSOFT, Studio Dragon, and Wemade, fell.
In contrast, defense stocks such as Hanwha Aerospace, Hyundai Rotem, Hanwha System, LIG Nex1, and Korea Aerospace Industries rose significantly. Following President Trump's order to suspend military support to Ukraine, European countries discussed increasing defense budgets under the pretext of ensuring peace for Ukraine. News that the U.S. Navy plans to procure new warships worth about 42 trillion won by 2054 also led to gains for shipbuilding stocks such as HD Hyundai Heavy Industries, HD Korea Shipbuilding & Offshore Engineering, Samsung Heavy Industries, and HMM.
Lee Kyung-min, a researcher at Daishin Securities, stated, "The domestic stock market's relatively good performance against tariff concerns is because the risks of tariffs were already priced in last Friday," adding, "By sector, the defense and shipbuilding sectors, driven by tensions from the Russia-Ukraine war and U.S. policy momentum, have supported the index, while the secondary battery sector, which could be affected by tariffs on Mexico and Canada, has seen a repositioning downward."
The KOSDAQ index closed at 737.90, down 6.06 points (0.81%) from the previous trading day. Individual and institutional investors net sold 36.7 billion won and 1.3 billion won worth of shares, respectively, while foreign investors net bought 42.4 billion won. In program trading, combined arbitrage and non-arbitrage transactions showed a buying preference of 63.4 billion won.
Among the top market-cap stocks in the KOSDAQ market, pharmaceutical and biotechnology stocks such as Alteogen, HLB, LigaChem Biosciences, PharmaResearch, and Kolon TissueGene rose. Ecopro BM, which had withdrawn its listing on the securities market, closed down over 5%. Voronoi surged over 20% on news that the first clinical results of its developing non-small cell lung cancer treatment would be released sooner than expected.
On that day, in the Seoul foreign exchange market, the won-dollar exchange rate was 1.6 won lower than the previous trading day, closing the weekly transaction at 1,461.8 won as of 3:30 p.m.