The KOSPI, which opened higher on the 4th, turned lower less than 30 minutes into trading and fell below the 6,300 level. As institutional net selling continues and foreign net buying weakens, the decline is widening. In contrast, the KOSDAQ is extending gains, showing a strong rise of more than 5%.
As of 10:44 a.m., the KOSPI was down 22.92 points, or 0.37%, at 6,234.53 from the previous session. The KOSPI started at 6,351.38, up 93.93 points, or 1.50%, and rose more than 2% early in the session, but it turned lower at about 9:28 a.m. and has been deepening its losses.
Top market-cap stocks also turned weak. Samsung Electronics is down 1.36% and SK hynix is down 1.72%. SK Square is up 1.07%, but Samsung Electro-Mechanics is down 1.10%.
Institutional selling is strong. Institutions are net selling 620 billion won on the main board. Individuals and foreigners are net buying 420 billion won and 146 billion won, respectively, but that is not preventing the index from falling.
Kim Seok-hwan, a researcher at Mirae Asset Securities, said, "As institutional net selling continues and the intensity of foreign net buying weakens, the decline is widening," and added, "This aligns with a somewhat weaker buying trend in semiconductor stocks, which saw the heaviest trading after margin call-style forced liquidations related to 'Situational Awareness' last week."
The domestic stock market surged 18% in a single day on the 31st and then fell 5% the day before, continuing extreme volatility. Bloomberg noted that if such sharp swings persist, the Korean stock market could be seen as a "difficult market to invest in," pointing to single-stock leveraged exchange-traded funds (ETFs) as a factor increasing volatility.
Yang Hyeong-mo, a researcher at DS Investment & Securities, said, "August is likely to be a period of raising the bottom while accompanied by volatility," adding, "We need to get through August with the principle that fear is a time to buy, not sell, the method of splitting purchases, and an attitude of calm."
The KOSDAQ is maintaining gains of more than 5%. As of 10:44 a.m., the KOSDAQ index was up 38.84 points, or 5.27%, at 776.19 from the previous session. While individuals and foreigners are net selling 130 billion won and 160 billion won, respectively, institutions are net buying 290 billion won.
Alteogen, the top market-cap stock, is up more than 8%, and EcoPro and EcoPro BM are also strong, up about 6% and 4%, respectively. In contrast, semiconductor materials, parts, and equipment stocks, which surged on the 31st, have somewhat paused in their rise. Wonik IPS is up 1.81%, and Jusung Engineering and LEENO Industrial are also up more than 3%.
Researcher Kim said, "As measures to revitalize the KOSDAQ market in the second half are discussed, the view is dominant that a decline of about 50% from the peak is excessive relative to fundamentals," adding, "Accordingly, institutions appear to be continuing 'cherry-picking' at the bottom, selectively buying stocks with solid earnings and value among those with large declines."