SEOUL, Oct. 23 (Korea Bizwire) — A recent report has identified a correlation between the incidence of severe weather alerts and a drop in the stock market.
Financial markets and consumers were also affected by weather forecasts and weather conditions, with credit card payments rising on sunny days.
According to a report released Tuesday by the Hana Institute of Finance, the benchmark Korea Composite Stock Price Index (KOSPI) fell by an average of 0.26 percent on the 66 days when severe weather announcements were issued last year.
The fall is large compared to the average rate of -0.03 percent for days without weather alerts.
In addition, on the day of the severe weather announcement, both trading volume and trading value on the stock market declined.
The average trading volume was 380 million shares with 6 trillion won in trading. This is small compared to 390 million shares and 6.4 trillion won on a day without weather alerts.
The transaction amount per trading value was also 15,861 won on days when there was a severe weather warning, lower than 16,371 won on usual days.
Among the weather alerts, the index fell sharply on days when heavy rain and cold warnings went into effect.
On the day of heavy rain warnings, the KOSPI and secondary KOSDAQ stock index fell 0.43 percent and 0.72 percent, respectively, from the previous day.
When there was a cold warning, the KOSPI fell 0.38 percent on average and the KOSDAQ fell 0.61 percent.
“A clear day is more profitable than a cloudy day,” the institute said. “Sunny days have affected consumer sentiment.”
D. M. Park (firstname.lastname@example.org)