Some stocks, including the KOSPI 200, have resumed short selling after a year and a half, while all stocks have resumed after five years, and the stock price of Samsung Electronics, the top company by market capitalization in South Korea, is sliding. The stock price has fallen more than 2%, losing the 60,000 won mark it recently regained after five months.
As of 9:41 a.m. on the 31st, Samsung Electronics is trading at 58,700 won, down 2.66% from the previous day.
This trend in stock prices is interpreted as having been influenced to some degree by the resumption of short selling. Short selling is an investment technique where shares are borrowed from others to place sell orders, betting on a decline in stock prices. Stocks with high levels of short selling tend to have increased selling pressure, making it likely for their prices to drop.
According to the Korea Financial Investment Association, Samsung Electronics ranked first in terms of short selling balance over the past week. Short selling balance refers to the quantity of shares borrowed by investors from institutions that has not yet been repaid, interpreted as an indicator of the short selling waiting stock. The short selling balance for Samsung Electronics is estimated at 75.33 million shares, amounting to 4.6 trillion won.
On the 20th of this month, Samsung Electronics completed its transaction at 60,200 won, reaching the 60,000 won level for the first time in 156 days since October 15 of last year. This was due to expectations of a recovery in Samsung Electronics' performance.
Global investment bank Morgan Stanley has developed a positive outlook on Samsung Electronics from a long-term perspective, raising its target price from 65,000 won to 70,000 won. Until last year, it was anticipated that a semiconductor winter was approaching, but the analysis has changed.
In its report, Morgan Stanley stated, "It's not the situation to say that the semiconductor industry has hit rock bottom, but the market is quickly looking beyond the 'valley (recession),'" adding, "We're maintaining a longer-term perspective to provide a more positive outlook until 2026." While Samsung Electronics has risen on the back of this expectation, the decline on that day revealed that the period of increase was not long.
Domestically, the securities industry still predicts a rosy future for Samsung Electronics. On that day, KB Securities raised its target price for Samsung Electronics from 70,000 won to 82,000 won.
Kim Dong-won, a researcher at KB Securities, analyzed, "Recently, the supply of DRAM and NAND has fallen short of even half of customers' requested order volumes," adding, "Supply is significantly lagging behind the pace of demand recovery, and rush orders from clients are increasing."