Samsung Electronics(005930) and SK hynix rolled out record shareholder return policies, helping the domestic stock market attempt a rebound, but the stock turnover in the main bourse fell to the lowest level this year. The KOSPI index, which had surged in the first half, swung sharply last month, which appears to have dampened investor sentiment.
According to the Korea Exchange (KRX) on the 23rd, the average daily turnover of listed shares on the main bourse this month (3–21) was 0.56%. This means about 5.6 shares out of every 1,000 listed shares changed hands per day on average. Turnover of listed shares is calculated by dividing trading volume by the number of listed shares; when trading between investors decreases, turnover falls.
The average daily stock turnover on the main bourse rose from 0.86% in January to 1.65% in February and 1.74% in March. It fell to 1.49% in April, and as concerns about a semiconductor cycle peak-out grew, it dropped further to 1.16% in May and 0.82% in June. In July, it was 0.72%.
When the market climbed steeply early this year, investors actively bought and sold stocks, and trading was brisk. But as the index underwent a sharp correction with big swings, investors are holding their existing stocks and not moving to make additional purchases or sales.
Regulations on single-stock leveraged products that took effect on the 31st of last month are also estimated to have affected the decline in stock turnover. As shares of Samsung Electronics and SK hynix jumped, funds flocked to short-term investment products, but trading volume fell sharply after the authorities' restrictions.
On the main bourse, both average daily trading volume and trading value are declining. This month, the KOSPI's average daily trading volume was 333.51 million shares, and the average daily trading value was in the mid-2.65 trillion won range, both the lowest levels this year.