The KOSPI index is keeping its rally going with a break above 8,000 points in sight, but warmth is barely spreading to the KOSDAQ market. Even though it broke above 1,200 for the first time ever on the nth, it has since been trapped in a trading range, slowing its moves. Even amid an unprecedented stock market boom, the KOSDAQ is relatively sidelined, drawing criticism that this is a "half-finished celebration."
According to the Korea Exchange (KRX) on the 12th, the KOSPI index has risen 85.6% so far this year, while the KOSDAQ index is up only 30.5%. The gap in transaction value is also evident. Since the start of this month, the KOSPI's average daily transaction value has surged 66.8% to 49.289 trillion won from 29.5507 trillion won in the previous month. By contrast, the KOSDAQ rose only 22.1%, from 14.0794 trillion won in the same period to 17.1955 trillion won this month. Even on the previous day, as the KOSPI broke through 7,800 and set a new record high, the KOSDAQ closed slightly lower.
The performance gap among large-cap stocks leading the indexes is widening. From the start of this year through the previous day, the KOSPI large-cap index (market capitalization ranks 1–100) jumped 93.8%, while large caps on the KOSDAQ rose only 29.9%.
Cho Joon-gi of SK Securities said, "If you look only at the indexes, the domestic stock market is continuing a super-strong trend, but the relative strength divergence between the KOSPI and KOSDAQ is extreme," adding, "Small and mid-cap stocks can show high volatility at the individual stock level, but in terms of the overall market trend, they are likely to move relatively sluggishly in both rising and falling markets."
In particular, a string of setbacks in pharmaceuticals and biotech, which had led KOSDAQ gains, is said to have sharply chilled investor sentiment. Sam Chun Dang Pharm at one point rose to No. 1 in KOSDAQ market capitalization on expectations for an oral obesity drug and an oral insulin, but the stock halved as suspicions about unclear contract terms overlapped with news of a block deal by a major shareholder. Alteogen plunged after word that royalties from sales of the Keytruda SC formulation, for which technology was transferred to a U.S. company, were below market expectations. ABL Bio also saw volatility expand, tumbling more than 25% intraday on the nth last month on disappointment over clinical results at its U.S. subsidiary.
Macro conditions are also working against the KOSDAQ. For biotech corporations, long research and development timelines make continuous funding essential, but the recent fade in expectations for rate cuts has increased funding burdens. On top of that, the artificial intelligence (AI) investment boom is drawing funds to large-cap KOSPI semiconductor names with clearer earnings visibility, such as Samsung Electronics and SK hynix.
It is also a drag that even individual investors, once the key source of demand in the KOSDAQ market, are showing signs of leaving. According to Koscom's ETF CHECK, over the past month, individual investors posted net sales of 680.6 billion won and 618.9 billion won, respectively, in "KODEX KOSDAQ150" and "KODEX KOSDAQ150 Leverage." The two products ranked No. 2 and No. 3 in net sales. In addition, KOSDAQ-related ETFs such as "TIGER KOSDAQ150" and "KoAct KOSDAQ Active" were heavily represented among top individual net sales.
The market says there remains mid- to long-term upside potential from the financial authorities' KOSDAQ revitalization policies and support measures for growth corporations. However, the prevailing view is that it will take time for policy effects to translate into real improvements in market fundamentals. As a result, for the time being, a differentiated market is likely to continue, with KOSPI strength centered on semiconductors and KOSDAQ weakness appearing simultaneously.
Lee Sang-yeon of Shinyoung Securities said, "There is a time lag until policies are detailed on the schedule presented at the capital market roundtable in March," adding, "A full-fledged approach at this point is somewhat premature."