An electronic signboard at KEB Hana Bank in Seoul shows the benchmark Korea Composite Stock Price Index (KOSPI) up 1.26 percent to close at 2,085.26 on March 5, 2020, the fourth consecutive increase amid expectations of further monetary easing by other major central banks following a U.S. rate reduction. (Yonhap)
SEOUL, March 6 (Korea Bizwire) — South Korean retail investors have rushed to fill in a stock market vacuum left by fleeing foreigners since the country confirmed its first coronavirus case in late January, data showed Friday.
Individual investors’ net buying of local stocks reached upwards of 9 trillion won (US$7.6 billion) between Jan. 20, when the first coronavirus patient was reported, and Thursday, according to the data from the Korea Exchange.
In February alone, small investors scooped up a net 4.9 trillion won, a record high for the month.
In particular, retail investors remained in net buying mode for 12 sessions in a row between Feb. 17 and Tuesday, the longest net buying streak in nearly eight years.
Retail investors’ buying binge came despite the stock market’s steep falls over the past two months. In the wake of the coronavirus outbreak, the benchmark Korea Composite Stock Price Index (KOSPI) plunged 3.58 percent in January.
As the pneumonia-like disease spread rapidly in the country, the key stock index sank deeper into negative terrain, shedding as much as 6.23 percent in February.
KOSPI especially tumbled 3.3 percent on Feb. 28, dipping below the psychologically important 2,000-point level.
Market watchers said retail investors snapped up beaten-down stocks in anticipation of price hikes, while international investors scrambled to take profits.
Top-cap Samsung Electronics Co., the world’s largest smartphone and memory chipmaker, was the darling of individual investors between Jan. 20 and Thursday with their net buying coming to 3.2 trillion won.
Retail investors also loaded up on chip giant SK hynix, leading cosmetics firm AmorePacific and Hotel Shilla, a luxury hotel chain affiliated with South Korea’s top conglomerate Samsung Group.
Offshore investors, in contrast, sold a net 2.8 trillion won worth of South Korean shares over the cited period, with Samsung being the most sold stock.
Analysts voiced concerns that retail investors stand to lose big from their investments should the local bourse go south again down the road.
Despite a recent upturn, it remains to be seen whether the stock market will be able to keep its upward momentum in light of rising coronavirus cases in the United States and other parts of the world, they added.
KOSPI rose 1.26 percent to close at 2,085.26 on Thursday, extending its gain to a fourth straight session amid expectations of further monetary easing by other major central banks following a surprise U.S. rate cut.
Observers said the local bourse could get a boost from a slowdown in the daily number of new coronavirus cases in South Korea. South Korea reported 322 new cases Thursday, down from 438 Wednesday, 516 Tuesday and 600 Monday.
As of early Friday, the country’s total number of infections came to 6,088, with the death toll reaching 42.
(Yonhap)
