◆Aju Economy Major News
▷KOSPI drops below 6,400 for the first time in over two months
- The KOSPI index has fallen below 6,400 for the first time in over two months, driven down by a more than 4% drop in major semiconductor stocks like Samsung Electronics and SK Hynix. The decline is compounded by rising government bond yields, surging international oil prices, escalating tensions between the U.S. and Iran, and foreign investor withdrawals.
- The KOSPI's sharp decline stands out when compared to other major global markets, which have seen gains over the past month. While the KOSPI has plummeted nearly 8%, other major indices have risen. Analysts express skepticism about a memory semiconductor supercycle, predicting that the bearish market will persist for the time being.
- According to the Korea Exchange, the KOSPI closed at 6,384.24 on October 12, down 241.69 points (3.65%) from the previous trading day. This marks the first time the index has dipped below 6,300 since August 11.
- The index opened at 6,578.17, down 47.76 points (0.72%) from the previous close, and fell to as low as 6,368.49 during the day. Foreign investors sold a net 2.2 trillion won, continuing a five-day streak of selling, while institutions and trusts sold 111.3 billion won and 328.2 billion won, respectively. Individual investors were the only group to buy, purchasing 1.4689 trillion won, but their efforts were not enough to support the index.
- The KOSPI's decline contrasts sharply with the performance of major global indices. The S&P 500, a benchmark for U.S. stocks, rose 2% from September 11 to October 9, while the Nasdaq increased by 3.9% and Taiwan's TAIEX climbed 6.8%. This growth reflects optimism about AI and semiconductor companies and their improved earnings. In contrast, the KOSPI has dropped nearly 8% during the same period.
◆Major Reports
▷Macro Update [NH Investment & Securities]
- With the ongoing AI cycle, South Korea is expected to achieve a growth rate of over 3% for two consecutive years. Currently, AI-related investments account for 2.0% of the U.S. GDP. The IT (semiconductor) industry embodies both cyclical and growth characteristics, and while the proportion of AI-related investments to GDP may eventually decline, it is expected to surpass the previous peak of 2.2% seen during the internet investment boom.
- Despite base effects, South Korea's export growth rate continues to expand. This increase in exports is leading to higher capital investment and government spending. Considering these factors, South Korea's GDP growth rate is projected to be 3.5% this year and 3.0% next year.
- The simultaneous rise in the dollar index and decline in the won-dollar exchange rate is noteworthy. Strong exports have led South Korea to record a significant current account surplus, which supports the strength of the won. However, demand for dollars due to foreign direct investment (FDI), including investments in the U.S., and overseas investments by the National Pension Service may offset some of this dollar supply.
- Globally, while U.S.-led growth continues, Europe faces pressures from poor performance in the AI sector and fiscal challenges, leading to downward pressure on the euro (and upward pressure on the dollar). Given Japan's reduced economic and trade stature, the Bank of Japan's interest rate hikes may not lead to significant yen strength. Considering external conditions, the won-dollar exchange rate is expected to remain in the mid-1,300 range on average.
◆Major Announcements After Market Close (October 12)
▷Kolon, designated as a company with inadequate disclosures
▷NH Investment & Securities, reports changes in major shareholder ownership
▷Korea Zinc, files a securities registration statement (debt securities)
◆Fund Trends (as of October 8, excluding ETFs)
▷Domestic equity funds: -1.9597 trillion won
▷Overseas equity funds: +289.2 billion won
◆Key Schedule for Today (October 13)
▷U.S.: OPEC monthly report
▷U.S.: Existing home sales (September)
▷KOSPI drops below 6,400 for the first time in over two months
- The KOSPI index has fallen below 6,400 for the first time in over two months, driven down by a more than 4% drop in major semiconductor stocks like Samsung Electronics and SK Hynix. The decline is compounded by rising government bond yields, surging international oil prices, escalating tensions between the U.S. and Iran, and foreign investor withdrawals.
- The KOSPI's sharp decline stands out when compared to other major global markets, which have seen gains over the past month. While the KOSPI has plummeted nearly 8%, other major indices have risen. Analysts express skepticism about a memory semiconductor supercycle, predicting that the bearish market will persist for the time being.
- According to the Korea Exchange, the KOSPI closed at 6,384.24 on October 12, down 241.69 points (3.65%) from the previous trading day. This marks the first time the index has dipped below 6,300 since August 11.
- The index opened at 6,578.17, down 47.76 points (0.72%) from the previous close, and fell to as low as 6,368.49 during the day. Foreign investors sold a net 2.2 trillion won, continuing a five-day streak of selling, while institutions and trusts sold 111.3 billion won and 328.2 billion won, respectively. Individual investors were the only group to buy, purchasing 1.4689 trillion won, but their efforts were not enough to support the index.
- The KOSPI's decline contrasts sharply with the performance of major global indices. The S&P 500, a benchmark for U.S. stocks, rose 2% from September 11 to October 9, while the Nasdaq increased by 3.9% and Taiwan's TAIEX climbed 6.8%. This growth reflects optimism about AI and semiconductor companies and their improved earnings. In contrast, the KOSPI has dropped nearly 8% during the same period.
◆Major Reports
▷Macro Update [NH Investment & Securities]
- With the ongoing AI cycle, South Korea is expected to achieve a growth rate of over 3% for two consecutive years. Currently, AI-related investments account for 2.0% of the U.S. GDP. The IT (semiconductor) industry embodies both cyclical and growth characteristics, and while the proportion of AI-related investments to GDP may eventually decline, it is expected to surpass the previous peak of 2.2% seen during the internet investment boom.
- Despite base effects, South Korea's export growth rate continues to expand. This increase in exports is leading to higher capital investment and government spending. Considering these factors, South Korea's GDP growth rate is projected to be 3.5% this year and 3.0% next year.
- The simultaneous rise in the dollar index and decline in the won-dollar exchange rate is noteworthy. Strong exports have led South Korea to record a significant current account surplus, which supports the strength of the won. However, demand for dollars due to foreign direct investment (FDI), including investments in the U.S., and overseas investments by the National Pension Service may offset some of this dollar supply.
- Globally, while U.S.-led growth continues, Europe faces pressures from poor performance in the AI sector and fiscal challenges, leading to downward pressure on the euro (and upward pressure on the dollar). Given Japan's reduced economic and trade stature, the Bank of Japan's interest rate hikes may not lead to significant yen strength. Considering external conditions, the won-dollar exchange rate is expected to remain in the mid-1,300 range on average.
◆Major Announcements After Market Close (October 12)
▷Kolon, designated as a company with inadequate disclosures
▷NH Investment & Securities, reports changes in major shareholder ownership
▷Korea Zinc, files a securities registration statement (debt securities)
◆Fund Trends (as of October 8, excluding ETFs)
▷Domestic equity funds: -1.9597 trillion won
▷Overseas equity funds: +289.2 billion won
◆Key Schedule for Today (October 13)
▷U.S.: OPEC monthly report
▷U.S.: Existing home sales (September)
* This article has been translated by AI.
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