KOSPI Plunges Over 3% Intraday Before Paring Losses as Foreigners Sell Both Cash and Futures
The KOSPI fell as much as 3.6% intraday on Monday before paring losses in the afternoon to close down about 2%, trading near the 6,760 level. The KOSDAQ also dropped more than 2.5% intraday before narrowing its decline to around 0.8%, holding above the 813-point level. Foreign investors net sold about 2.3 trillion won in KOSPI cash alone, sold roughly 1 trillion won in futures, and net sold about 80 billion won on the KOSDAQ. The won-dollar exchange rate moved around the 1,344 won level.
Samsung Electronics and SK Hynix fell about 2% and 5%, respectively, leading the index decline, a move attributed to the AI development slowdown comments from Anthropic's CEO discussed below. By contrast, some sectors including cosmetics and aesthetic medicine, information security, MLCC, telecom equipment, and banks turned positive intraday, cushioning further declines.
Despite US August core CPI rising 0.3% month-over-month, above the market consensus of 0.2%, US equities closed higher. Commentators noted the reading was borderline enough to be read either way, since stripping out a temporary statistical distortion in telecom service pricing would put it roughly in line with expectations. Per CME FedWatch, the probability of a rate hike at this week's FOMC meeting has risen to 86%.
This week was characterized as a rate super-week, with the US FOMC rate decision on Wednesday (3am Thursday Korea time), the Bank of England meeting Thursday, and the Bank of Japan meeting Friday. The final signing of the Korea-US investment MOU is also scheduled for Friday, making for a week packed with major events.