Korea's stock market is showing a divergent pattern, with indexes and individual stocks moving separately amid weakness in major semiconductor names such as Samsung Electronics (005930.KS) and SK hynix (000660.KS). The fall in large-cap stocks has weighed on the KOSPI, yet the number of advancing stocks far outnumbers decliners, while the KOSDAQ has extended its gains, triggering a buy sidecar for three consecutive trading sessions. Analysts say a sector-rotation market is unfolding, in which funds that concentrated on leading stocks such as semiconductors in the first half are spreading to other names, warming the market as a whole.
According to the Korea Exchange on the 4th, the KOSPI stood at 6,201.89 as of 1:30 p.m., down 55.56 points, or 0.89%, from the previous session. The KOSPI rose more than 1% in early trading on the strength of an overnight rally on the New York stock market, climbing to around 6,380, but turned lower about 30 minutes after the open as profit-taking poured in centered on large-cap semiconductor stocks. The index, which had been pushed down to around 6,100 during the session, pared its losses and continued to fluctuate around the 6,200 level.
Despite the index's weakness, the overall market mood is not bad. Amid fallout from reports of a plant expansion by China's Changxin Memory Technologies (CXMT), semiconductor leaders such as Samsung Electronics (-3.13%) and SK hynix (-3.06%), along with Samsung Electro-Mechanics (009150.KS) (-2.12%) and Hyundai Motor (005380.KS) (-2.29%), showed weakness, but concentration is easing as funds move to other sectors. With the number of advancing stocks on the KOSPI (691) far exceeding decliners (186), names such as LIG Defense & Aerospace (079550.KS) (+12.88%), SK Telecom (017670.KS) (10.24%), Hanwha Aerospace (012450.KS) (9.36%), Naver (035420.KS) (+7.47%) and Doosan Enerbility (034020.KS) (6.06%) are surging.
The KOSDAQ is riding a warm breeze, triggering a buy sidecar for three straight sessions. At the same time, the KOSDAQ index stood at 775.06, up 37.71 points, or 5.11%, from the previous session. On the KOSDAQ, 1,429 stocks were advancing, and 9 stocks hit their upper limit. Of the top 50 stocks by market capitalization, 47 rose, with warmth spreading across all sectors including bio, secondary batteries and robotics.
By trading flows, individual investors net bought 700 billion won on the KOSPI, while foreigners and institutions net sold 104.1 billion won and 676.6 billion won, respectively. On the KOSDAQ, institutions led the index with net buying of 453.7 billion won, while individuals and foreigners sold 195.7 billion won and 251.8 billion won, respectively.
Kang Jin-hyuk, a researcher at Shinhan Investment Corp., said, "Large-cap semiconductor stocks are struggling due to noise such as the CXMT plant expansion, but concentration is easing and a sector-rotation flow is emerging." He added, "As funds flow into large-cap KOSDAQ stocks such as bio and secondary batteries, the KOSDAQ's outperformance is continuing, along with the buy sidecar being triggered for three straight days."
