Purchase of Foreign Investors led a Tendency of Decrease on Stock Price.

Finally Happened!

KOSDAQ was the lowest point a year yesterday, and today KOSPI dropped to the lowest point a year.

Because of a warning of American firms’ business performance and concern on ‘Gulf War II, NASDAQ index dropped to the lowest point since 1996

However, there was the small expectation of rally as Korea`s stock exchange market and KOSDAQ market had more trading volume and trading values over the precious year.

The index decreased because the foreign investors sold stocks of over 200 billion won. As ‘Program Buy Order’ using a price difference between spots and futures increased in the second half of the market, the index rebounded to a level of 670 points. However, when excluding the program buying volume, the institutions also purchased.

Top rankers of the stock exchange market showed advance-decline. Stock price of Samsung Electronics has continued to decrease and dropped to 310,000 won after the lapse of 40 days. The stock price of Kookmin Bank, POSCO and Hyundai Motor decreased by 2∼4%. However, SK Telecom, KT, KEPCO and Shinhan Financial Group showed a little increase through selective purchase of foreign investors.

Without distinct source, Samsung Pharm has showed continuous upper limit price for 8 days. For Hanwha Group succeeding in acquiring Korea Life, Hanwha Chemical Contribution 1 preferred stock, Hanwha Securities preferred stock and Hanwha showed a bull market.

KOSDAQ index decreased continuously for 4 days and showed the lowest point a year. In particular, large capital stocks struggled desperately.

Such as Young Poong Mining & Construction, Hyundai Corporation, Techmate Corporation and Hae Ryong Silicon, ‘War beneficiary stocks’ turned around toward the tendency of decrease after one day. Instead, as Daily Sports and LOTOTO showed the increase tendency of stocks, they are regarded as ‘Asian Game Beneficiary Stock’.

Cheol-Yong Lee lcy@donga.com