Surpassing Market Cap of 1,600 Trillion Won
The KOSPI renewed its highest record in terms of index, market cap and increase rate this year.
The Korea Exchange (KRX) announced on December 28 that the KOSPI index hit an all-time high at 2,557 on November 7 this year, posting the highest rise at 21.8 percent in eight years after 49.7 percent in 2009.
With the global stock market having remained bullish by and large, the domestic stock market showed a remarkable growth. The KOSPI ranked sixth in terms of index increases among the Group of Twenty (G20) nations, climbing up eight places from the 14th in the previous year. The KRX said, “The sound fundamentals for the stock market stood out due to the increase in exports based on the recent economic recovery and the improvement in domestic companies’ performance.
The KOSPI market capitalization increased 298 trillion won (US$278.24 billion) to 1,606 trillion won (US$1.5 trillion) compared to the previous year. Large-cap stocks accounted for 78 percent of the total market cap at 1,253 trillion won (US$1.17 trillion), up 0.9 percent point, or 244 trillion won (US$227.82 billion), from a year ago. However, the share of small and medium-cap stocks decreased 1.5 percent points and 0.6 percent point, respectively.
In contrast, the amount and volume of the daily average transactions had a modest increase. The amount of the daily average transactions rose 810 billion won (US$756.3 million) from 4.52 trillion won (US$4.22 billion) last year to 5.33 trillion won (US$4.98 billion) this year, while the volume of the daily average transactions dropped 9 percent from 380 million shares to 340 million shares.
By industry, large-cap shares sensitive to economic ups and downs, which are expected to improve performance, showed the high increases. Out of 21 KOSPI indexes by industry, 16 sector indexes by increased – pharmaceutical by 62.9 percent, electrical and electronics by 45.4 percent and securities by 27.7 percent – while the remaining five sector indexes decreased – paper and lumber by -17.6 percent and electricity gas by -11.7 percent.
By investor, foreigners net bought 6.6 trillion won (US$6.16 billion) worth of KOSPI stocks, while institutions and individuals net sold 2.4 trillion won (US$2.24 billion) and 9.3 trillion won (US$8.68 billion), respectively. Offshore investors have kept up buying spree for the second consecutive year, prompting the uplift in the market, while institutional and individual investors have extended their selling spree for four years and nine years in a row.
Twenty one new companies were listed on the KOSPI as companies spun off from large blue-chip companies and conglomerates, such as Lotte and Hyundai Heavy Industries, were relisted in order to reform the governance structure. Initial offering prices reached 4.4 trillion won (US$4.11 billion), the highest since 8.7 trillion won (US$8.13 billion) in 2010.