[Seoul Market Wrap] KOSPI Recovers to 5550-Mark, KOSDAQ Bleeds Under Heavy Selling for Second Straight Day

Domestic Markets Show Divergent Trends

Institutional investors' net purchases of KRW 868.7 billion drove the KOSPI up 0.30%, while foreign investors' net sales of KRW 981.4 billion weighed on the KOSDAQ, which fell 1.62%. The secondary battery and electric/electronics sectors led the decline, while individual stocks with specific catalysts surged.

On the 23rd, the domestic market saw a divergence in the KOSPI and KOSDAQ. The KOSPI rebounded after a day of decline, thanks to institutional buying despite foreign selling. Conversely, the KOSDAQ continued its slide, led by the secondary battery and electric/electronics sectors.

According to the Korea Exchange, the KOSPI closed at 5,550.30, up 16.53 points (0.30%) from the previous day's trade. The KOSDAQ ended at 751.69, down 12.41 points (1.62%). The won-dollar exchange rate closed the week at 1,324.6 won per dollar, up 0.4 won from the previous day.

The KOSPI opened lower due to concerns over the profitability of U.S. AI companies and rising oil prices amid geopolitical tensions in the Middle East. Foreign selling expanded throughout the day, particularly in the electric/electronics sector, but institutional buying at lower levels helped the index close slightly higher.

Market Performance by Sector

The pharmaceutical sector led the gains, surging 3.5%, followed by medical devices and electronics, which rose 2.5% and 1.3%, respectively. The general services sector also saw a boost, climbing 0.9%. Notably, large-cap stocks managed a modest 0.5% increase, while mid-cap and small-cap stocks struggled, falling 2.0% and 1.5%, respectively.

Supply and Demand Dynamics

Foreign investors exerted late-session selling pressure, with net sales of KRW 981.4 billion. In contrast, institutional and individual investors stepped up as buyers, with net purchases of KRW 868.7 billion and KRW 44.8 billion, respectively. Foreign Investors focused their selling on the electronics and financial sectors, with net sales of KRW 908.7 billion and KRW 188 billion, respectively, while also offloading food and beverage stocks, with net sales of KRW 26.6 billion.

KOSDAQ: Foreign Selling Weighs

The KOSDAQ index extended its losses for the second consecutive day, influenced by the previous day's weakness in U.S. semiconductor stocks. Foreign selling pressure centered on secondary batteries and the electronics sector, with the broader index falling under the weight of declines in publishing (-5.2%), finance (-4.0%), and metals (-2.2%) sectors. Individual investors were net buyers, with KRW 63.6 billion in purchases, while Foreign Investors and institutions were net sellers, with KRW 44.3 billion and KRW 25 billion in sales, respectively.

Individual Stocks Soar Amid Market Volatility

In the midst of a mixed market, individual stocks with specific catalysts saw significant gains. Shares of Jin Yang Chemical (051630) surged 29.81% on news of Seoul Mayor Oh Se-hoon's acquittal in his appeal trial. Jin Yang Holdings (100250) also rose, gaining 3.64%. Meanwhile, speculation surrounding the death of North Korean leader Kim Jong Un sent defense stocks soaring, with Speko (013810) leading the charge, up 29.98%.

Samsung E&A (028050) rose 7.94% due to good performance and treasury stock cancellation plan. SK Hynix (000660) rose 4.42% on the news of Solidigm's suspension of IPO review, and iFamily SCC (114840) soared 29.93% on the push for a tender offer by Japan's Marubeni affiliate.

Contact (451760) rose 29.87% on the news of the successful verification of space optical communication. Monitor Lab (434480) rose 13.07% on expectations of increased demand for cybersecurity due to PHP security vulnerabilities. Noeul (376930) soared 29.96% following the decision to increase paid-in capital to a third party worth approximately 2.8 billion won.

On this day, DTS (0015M0), newly listed on KOSDAQ, finished trading at 25,000 won, up 35.14% from the public offering price.

On the other hand, Foodnamu (290720) fell 18.88% due to uncertainty related to financing and negotiations for the sale of the largest shareholder's stake. Bioinfra (199730) fell 14.17% due to continued uncertainty about delisting related to market capitalization requirements.