Profit-taking compounds US big-tech weakness after recent surge; foreigners net-sell more than 1.4 trillion won while retail investors buy 1.3 trillion won; Kosdaq also falls more than 2%

The trading board at Hana Bank's dealing room in Jung-gu, Seoul, displays the Kospi and other market indicators on Friday. The Kospi opened down 117.12 points, or 1.31 percent, at 8,813.18, while the Kosdaq opened 0.38 percent lower at 884.43. [Yonhap]
The trading board at Hana Bank's dealing room in Jung-gu, Seoul, displays the Kospi and other market indicators on Friday. The Kospi opened down 117.12 points, or 1.31 percent, at 8,813.18, while the Kosdaq opened 0.38 percent lower at 884.43. [Yonhap]

The Kospi shed more than 3 percent in early trading Friday, retreating to the 8,600 level as profit-taking pressure from a recent sharp rally combined with weakness in US big-tech stocks. Foreign investors net-sold more than 1.4 trillion won ($906 million) in shares, while the Kosdaq also fell more than 2 percent.

According to Korea Exchange, the Kospi was trading at 8,658.41 as of 9:51 a.m., down 271.89 points, or 3.04 percent, from the previous session. The index opened at 8,813.18, down 117.12 points, or 1.31 percent, before extending its losses.

Foreign investors drove the decline on the main bourse with net selling of 1.4 trillion won ($906 million). Retail investors and institutions were net buyers of 1.37 trillion won and 50.2 billion won, respectively.

Most large-cap stocks were also in the red. SK Hynix fell 3.57 percent to 2,813,000 won, while SK Square dropped 7.21 percent to 1,762,000 won. Samsung Electronics (-2.79 percent), Hyundai Motor (-3.18 percent), Samsung Life (-2.24 percent) and LG Energy Solution (-2.56 percent) all declined. Samsung Electro-Mechanics (up 2.15 percent), Samsung C&T (up 0.58 percent) and SK Corp (up 1.28 percent) bucked the trend.

The Kosdaq also remained weak. At the same time, it was down 18.45 points, or 2.08 percent, at 869.36, having opened at 884.43 — a drop of 3.38 points, or 0.38 percent — before widening its losses.

On the Kosdaq, foreign investors and institutions were net buyers of 14.3 billion won and 86.4 billion won, respectively, while retail investors were net sellers of 102.5 billion won.

Among Kosdaq large-caps, Alteogen (-3.33 percent), Ecopro BM (-4.58 percent), Ecopro (-3.33 percent), Rainbow Robotics (-4.26 percent), Kolon TissueGene (-3.19 percent), Jusung Engineering (-1.20 percent) and Leeno Industrial (-4.85 percent) were all lower. Wonik IPS (up 2.91 percent) and EO Technics (up 0.31 percent) moved higher.

Market analysts said mixed performance on Wall Street and profit-taking pressure following the recent rebound were weighing on the market Friday.

Han Ji-young, a researcher at Kiwoom Securities, said the domestic market "opened lower amid the spillover from mixed US equities and short-term profit-taking pressure following the previous session's sharp gains." She added that "during trading, supply-and-demand volatility is likely to increase and index movement will be limited as momentum stocks attract concentrated buying while neglected stocks draw bargain hunters."

Han also said the recent market recovery had been driven almost entirely by semiconductors. "Over the past two trading sessions, the Kospi rebounded more than 8 percent, but investor sentiment in most sectors outside semiconductors and energy has not recovered sufficiently," she said. "It was in effect a semiconductor-only rally."

She added that "market volatility remains elevated, with the volatility index VKOSPI surging to around the 95 level," and that "as long as the concentration in a handful of sectors such as semiconductors continues, high volatility across the broader market will be unavoidable for now."


hajun825@heraldcorp.com