The KOSPI fell back below the 5,100 level as foreign investors intensified their selling spree, widening losses on the index.
As of July 31, the KOSPI was trading at 5,072.87, down 204.43 points (3.87%) from the previous session, according to Korea Exchange (KRX). The index opened at 5,143.75, down 133.5 points (2.53%). It briefly pared losses during the session on reports that U.S. war objectives had been scaled back from earlier positions, but heavy foreign selling dragged it back below 5,100.
By investor type, foreigners were solely responsible for pulling the index down with net selling of 3.116 trillion won ($2.2 billion). Foreign investors have posted net sales for nine consecutive trading days since the 19th of this month, accelerating capital outflows from the Korean stock market. Retail and institutional investors, meanwhile, provided downside support with net purchases of 1.967 trillion won and 845.1 billion won, respectively.
Most top market-cap stocks also declined. Samsung Electronics (005930.KS) and SK hynix (000660.KS), the market's two largest stocks by capitalization, plunged 4.42% and 6.30%, respectively, leading the downturn. LG Energy Solution (373220.KS) fell 3.29%, Hyundai Motor (005380.KS) dropped 4.58%, Hanwha Aerospace (012450.KS) slid 6.12%, SK Square (058850.KS) tumbled 8.33%, Doosan Enerbility (034020.KS) declined 2.23%, and Kia (000270.KS) lost 3.63%. Samsung Biologics (207940.KS) was the sole gainer, edging up 0.59%.
"Overnight, the semiconductor index underperformed led by Micron, affected by downward revisions to notebook and smartphone shipment forecasts and the turbo quant fallout," said Kang Jin-hyuk, a researcher at Shinhan Investment Corp. "Foreigners have continued trillion-won-scale dumping in the KOSPI market for the ninth straight day."
The KOSDAQ index opened at 1,099.08, down 7.97 points (0.72%) from the previous session, but extended losses during the session and was trading down more than 4%. All top 10 stocks by market capitalization were declining. Retail investors were the sole net buyers at 103.6 billion won, while foreigners and institutions posted net sales of 14.4 billion won and 3.9 billion won, respectively.
"The direction of the stock market going forward will hinge on whether U.S. ground troops are actually deployed," said Kim Yong-gu, a researcher at Yuanta Securities. "A V-shaped rebound is expected in the event of a ceasefire."
