The Korea Composite Stock Price Index (KOSPI) dipped below 1,940 points due to foreign investors’ net selling trend. They recorded a net selling amount of approximately 280 billion won (US$262 million) between March 1 and 12. It is forecast that the bourse will remain bearish for the time being, with the uncertainties going on for the economic and political situations in China and Ukraine.
Still, foreign investors are continuing to buy Samsung Electronics and SK Hynix shares, and securities market experts are saying that at least some stocks and sectors including them are worthy of attention, in spite of the downward trend.
The KOSPI closed at 1,932.54 points on March 12, losing 31.33 points or 1.60% from the previous session. Foreign investors’ net selling amount reached 283 billion won (US$265 million) on that day alone, and institutional investors added to the pace by net-selling 206 billion won (US$193 million) worth of shares. The decline was compounded by the day being a double witching day, concerns over China and Ukraine, and the Federal Open Market Committee (FOMC) meeting scheduled soon.
The market consensus is that the downward spiral is likely to continue at least for a while. “The issue between Russia and Crimea is adding to uncertainties in the market, while no significant momentum is found,” said Lee Ah-ram, a NH Nonghyup Securities research analyst, adding, “The unfavorable conditions are predicted to last until the FOMC meeting.”
However, foreign investors are likely to take a favorable turn toward the Korean stock market once some of the situations are addressed. Under the circumstances, individual investors are increasing their attention to those stocks that have been preferred by their foreign counterparts, such as Samsung Electronics and SK Hynix.