With yields on U.S. Government Bonds surging and weakening investor sentiment, the KOSPI index is down 5% and trading in the 6,500 range on the 19th.
As of 11:23 a.m. on the day, the KOSPI index was down 358.13 points (5.21%) from the previous transaction day at 6,511.7. About five minutes after the transaction started that day, the index plunged 6% and fell into the 6,400 range, triggering a sell-sidecar (temporary suspension of program trading sell quotes). It then slightly pared losses and is trading in the 6,500 range.
Foreign investors are net sellers of 1.7 trillion won and institutions 1 trillion won, dragging the index lower. It is the first net selling by foreigners in 5 transaction days. Individuals alone are net buyers of 2.6 trillion won, bargain-hunting.
The decline in technology stocks is pronounced. SK hynix(000660) is plunging 8%, and Samsung Electronics and Samsung Electronics(1P) are also down 6%. On news of a U.S. wheeled K9 order, only Hanwha Aerospace(012450) is up 3%.
Yields on U.S. Government Bonds have soared to a record high for the first time in 19 years, worsening investor sentiment. According to the Wall Street Journal (WSJ) and other foreign media on the 18th (local time), the yield on 30-year U.S. Government Bonds rose intraday to 5.33% per year. It is the highest level since 2007, in 19 years. When market interest rates rise, they raise the funding expense of corporations and increase the stock discount rate, typically acting as a headwind for the stock market.
At the same time, the KOSDAQ index is down 2.61 won (0.31%) from the previous transaction day at 831.59 won. The index opened lower that day, then turned higher intraday and traded in the 840 range. It has now turned lower again and is trading in the 830 range.
Individuals are net sellers of 44.8 billion won, dragging the index lower. Foreign investors and institutions are net buyers of 38.4 billion won and 4.3 billion won, respectively.