Kospi recovers 6,160 level in early trade
Rebound follows Tuesday's 5% plunge
Foreigners net buyers for first time in 7 sessions
Samsung Electronics up 3%, SK hynix up 2%
Kosdaq flat; foreigners still net sellers
The Kospi rebounded more than 2 percent in early trade Wednesday, snapping a five-session losing streak. Bargain hunters moved in after Tuesday's plunge of more than 5 percent, and foreign investors — who had been net sellers for six straight sessions — switched to net buying. Semiconductor heavyweights Samsung Electronics and SK hynix also rose.
According to Korea Exchange, the Kospi opened Wednesday up 26.73 points, or 0.44 percent, at 6,062.08 and climbed as high as 6,167.65, a gain of 2.19 percent, in early trade. The index had fallen more than 5 percent on Tuesday and had closed lower in each of the previous five sessions.
Foreign investors led the advance, ending a six-session run of net selling with net purchases of 55.2 billion won ($41.2 million). Retail investors and institutions were net sellers of 57.5 billion won and 24.6 billion won, respectively.
Overnight on Wall Street, all three major indexes closed lower. The Dow Jones Industrial Average fell 0.35 percent, while the S&P 500 and the NASDAQ Composite slipped 0.02 percent and 0.15 percent, respectively. Reactions to third-quarter earnings from major US banks were mixed, and some semiconductor-related stocks extended the weakness seen in Asian markets, including South Korea, on Tuesday.
Micron fell 3.62 percent, SK hynix's American depositary receipt dropped 3.19 percent and Western Digital declined 1.61 percent, while the Philadelphia Semiconductor Index shed 0.23 percent. Broadcom and Intel bucked the trend, rising 0.73 percent and 1.44 percent, respectively. Citigroup, Goldman Sachs and Wells Fargo all reported higher net profit than a year earlier, but their shares still fell.
Sentiment recovered somewhat during the session after New York Federal Reserve President John Williams signaled caution on further rate hikes.
Williams told Bloomberg News that he views one more rate increase this year as appropriate but does not see the need for another hike next year.
Federal Reserve Governor Christopher Waller said the surge in long-term US Treasury yields is helping to curb demand in interest-rate-sensitive sectors, effectively doing some of the work of tighter monetary policy.
The Kospi opened higher Wednesday, shaking off five straight sessions of losses. The two semiconductor giants also rebounded, supported in part by bargain buying.
Samsung Electronics was trading up 3.56 percent at 240,250 won, having opened 0.65 percent higher and quickly extended its gains; it briefly touched 241,000 won, up 3.88 percent. SK hynix rose 2.63 percent to 1,481,000 won, opening up 1 percent and at one point recovering to 1,487,000 won, a gain of 3.05 percent.
Among other large-cap stocks, SK Square gained 1.87 percent, Samsung Electro-Mechanics rose 2.20 percent and LG Energy Solution advanced 2.32 percent. Samsung Biologics fell 1.49 percent, Shinhan Financial Group dropped 1.30 percent and Doosan Enerbility slipped 0.57 percent.
The Kosdaq opened down 1.13 points, or 0.14 percent, at 835.90 and has been oscillating between gains and losses in early trade, hovering near the flat line.
On the Kosdaq, foreign investors were net sellers of 136 billion won, and institutions added selling pressure with net sales of 37 billion won. Retail investors were net buyers of 171.6 billion won. Alteogen rose 0.89 percent, Ecopro gained 2.46 percent and Ecopro BM added 0.35 percent, while Jusung Engineering fell 4.20 percent, Rainbow Robotics dropped 0.91 percent and Wonik IPS declined 2.84 percent.
th5@heraldcorp.com
