KOSPI Closes with Nearly 4% Plunge... Largest Drop Since Lee Jae-myung Government Inception [fn Closing Market]

[Financial News] The KOSPI index plummeted nearly 4% on the 1st, falling to the 3110 level. KOSDAQ fell over 4%, breaking the 800 level.
According to the Korea Exchange, the KOSPI index closed at 3119.41, down 3.88% from the previous trading day. This is the first time the KOSPI has plunged more than 3% since the inception of the Lee Jae-myung government. Starting at 3210.32, down 1.08% from the previous session, the KOSPI saw the 3200 level collapse.
In the securities market, foreigners and institutions sold 841.2 billion won and 1.1678 trillion won, respectively. On the other hand, individuals bought 1.9535 trillion won worth.
The impact of disappointment sales due to concerns over the tax reform plan was significant. The previous day, the government announced a tax reform plan that included lowering the 'major shareholder' standard, subject to capital gains tax on stocks, from 5 billion won to 1 billion won, and introducing a maximum 35% separate taxation on dividend income. Additionally, the delay in the US interest rate cut and the rising trend of the won-dollar exchange rate also increased the downward pressure on the index.
Lee Jae-won, a researcher at Shinhan Investment Corp., evaluated, "The policy momentum, such as the Commercial Act amendment, was one of the pillars of the stock market's upward momentum in July," adding, "That pillar collapsed significantly due to disappointment, leading to a decline."
He continued, "The retreat of interest rate cut expectations is also a persistent concern factor in August," emphasizing, "According to FedWatch, the US base rate in September is expected to remain unchanged."
Most of the top market cap stocks closed lower. In particular, Hanwha Aerospace (-5.72%), SK Hynix (-5.67%), Samsung Electronics (-3.50%), and Samsung Biologics (-3.09%) plummeted. On the other hand, Hanwha Ocean (4.54%) closed higher.
By sector, securities (-6.48%), electricity and gas (-5.72%), metals (-5.61%), and finance (-4.95%) fell sharply.
On this day, the KOSDAQ index closed at 772.79, down 4.03% from the previous trading day. In the KOSDAQ market, foreigners and institutions net sold 116.7 billion won and 141 billion won worth, respectively. On the other hand, individuals bought 268.6 billion won worth.



hippo@fnnews.com Kim Chan-mi Reporter