The KOSPI index fell more than 3% to below 6,700 points, driven by a sharp decline in Samsung Electronics shares. Disappointment over Samsung's recently announced shareholder return plan led to heavy selling by foreign and institutional investors, pulling the index down.
On August 24, the KOSPI closed at 6,696.96, down 216 points (-3.12%) from the previous trading day. Foreign and institutional investors sold a net 3.6881 trillion won and 1.2925 trillion won, respectively. Retail investors, however, bought a net 3.3206 trillion won, but this was not enough to prevent the index from falling.
Among large-cap stocks, Samsung Electronics saw a significant drop, falling 8.70%, while Samsung Electronics preferred shares dropped 8.55%. SK Hynix declined by 3.41%, and other major stocks like SK Square (-4.19%) and Samsung C&T (-7.84%) also faced losses. In contrast, LG Energy Solution rose by 5.39%, and Samsung Biologics increased by 1.42%.
The steep decline in Samsung Electronics is attributed to disappointment over its shareholder return plan announced on August 21. The company projected a shareholder return of 90 trillion to 110 trillion won for 2024-2026, but it did not include a large-scale share buyback and cancellation that the market had anticipated. Analysts noted that Samsung Life and Samsung Fire's ownership stakes in Samsung Electronics are constrained by the 10% limit under the Financial Holding Company Act, which may restrict further share buybacks.
In contrast, the KOSDAQ index closed at 813.33, up 11.39 points (1.42%) from the previous day. Foreign and institutional investors bought a net 241.7 billion won and 24.9 billion won, respectively, boosting the index, while retail investors sold a net 260.4 billion won.
In the KOSDAQ, secondary battery stocks performed well, with EcoPro rising by 7.59% and EcoPro BM soaring by 10.80%. Pharma Research also increased by 3.87%. However, stocks like Rainbow Robotics (-2.09%), HLB (-2.07%), Lino Industry (-1.67%), and EoTechnics (-4.08%) experienced declines.
Lee Kyung-min, a researcher at Daishin Securities, stated, “The KOSPI is testing its support at the 6,680 level due to net selling by foreign and institutional investors. Given that the number of rising stocks exceeds that of falling stocks, the sharp drop in Samsung Electronics and its affiliates has exaggerated the decline in the index.”
* This article has been translated by AI.
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