South Korean stock markets reached their biggest this week, with record-breaking market capitalization as foreigners returned in full force to extend the hot streak led by retailers and push the indices to their two-year best.
According to the country’s sole stock exchange operator Korea Exchange (KRX), market cap of the Kospi and Kosdaq on Wednesday reached their respective high of 1,704 trillion won ($1.5 trillion) and 328 trillion won. Kospi previous best was 1,689 trillion won in January 2018. The record was more or less sustained Thursday with Kospi closing at capitalization of 1,698 trillion won and Kosdaq at 328.5 trillion won.
The benchmark Kospi finished Thursday a tad lower at 2,475.62 from Wednesday closing of 2,485.87 after renewing annual best closing throughout the week. Wednesday’s was the highest since 2,487.25 on May 3, 2018. Kosdaq ended at 0.02 up at 840.08.
Overseas investors net bought more than 800 billion won in the Kospi market, while retail investors massively sold off 1.2 trillion won to take profits. The Kosdaq market lost 0.11 percent to finish at 839.90.
Foreigners mostly bought market heavyweights and exporting companies including Samsung Electronics and Posco as well as financial stocks such as Hana Financial Group and Shinhan Financial Group. That boosted value stocks, which refer to companies engaging in traditional backbone industries that have relatively cheap valuations.
Hana Financial Group rose 3.15 percent and Shinhan Financial 2.12 percent on Wednesday thanks to the foreign demand. Samsung Electronics grew 1.83 percent to 61,300 won and Posco 0.63 percent.
Market experts predict the Kospi bull to last until the end of the year, though some moderate correction could occur.
By Shin Yoo-kyung and Choi Mira
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