Korean retail investors executed an unprecedented volume of net purchases on the last trading day before the extended holiday. However, market sentiment shifted dramatically as geopolitical tensions surrounding Iran escalated rapidly during the break.
According to the Korea Exchange, retail investors' average daily net purchases on the KOSPI reached 819.1 billion won last month, up more than 100 billion won from January's 710 billion won average—a record high on a monthly basis.
On February 27, foreign investors recorded their largest-ever single-day net selling of 7.7476 trillion won on the stock exchange, while retail investors posted the second-largest net purchase on record at 7.419 trillion won. Retail capital absorbed the foreign selling pressure, limiting the KOSPI's decline to 1%.
According to the Korea Financial Investment Association, investor deposits reached 119.4832 trillion won as of February 26, surging 119.5% year-over-year. Margin trading balances also hit a record high of 32.3685 trillion won on the same day, swelling by more than 5 trillion won in less than three months from 27 trillion won at year-end. A rapid increase in margin balances can trigger forced selling during market downturns, amplifying losses.
International oil prices are climbing. West Texas Intermediate crude futures on the New York Mercantile Exchange rose 2.76% to $69.78 per barrel, briefly exceeding $74 in early trading. Brent crude futures also gained 3.4% to $76.22, having earlier surged more than 9%—the largest spike in four years—before paring some gains.
Rising oil prices could fuel inflationary pressures and reignite rate hike discussions, potentially weighing on growth stocks such as semiconductors that have commanded premium valuations. Experts advise that while massive retail inflows are supporting the market, investors should remain cautious of heightened volatility from external factors.