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KOSPI Plunges amid COVID-19 Fears
KOSDAQ Drops 4.3% on Feb. 24
KOSPI Plunges amid COVID-19 Fears
  • By Yoon Young-sil
  • February 25, 2020, 09:24
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KOSPI and KOSDAQ plunged 3.87 percent and 4.3 percent, respectively, on Feb. 24.

The Korea Composite Stock Price Index (KOSPI) dropped 3.87 percent to close at 2,079.04 points on Feb. 24, dipping below 2,100 points for the first time since Dec. 10 last year and showing the steepest daily decline in about 16 months. Likewise, the Korea Securities Dealers Automated Quotation Index (KOSDAQ) dropped 4.3 percent to close at 639.29 points.

As a result, the aggregate value of the South Korean stock market dropped by 67 trillion won on Feb. 24 alone and 93 trillion won on Feb. 21 and 24 after the number of confirmed COVID-19 infections in South Korea began to soar on Feb. 21. On Feb. 24, foreign investors sold shares worth 785.7 billion won in the KOSPI market alone, posting the largest daily net selling since Nov. 26, 2019.

Besides, the won-dollar exchange rate jumped 11 won per U.S. dollar to close at 1,220.2 won per U.S. dollar on Feb. 24. The rate has risen 62.1 won since Jan. 20 and soared by 30 won for the past three trading days.

The prices of safe assets such as bonds hiked under the circumstances. For instance, the three-year treasury bid rate dropped by 4.3 basis points to 1.139 percent as uncertainties led to more bond demand and predictions spread that the Bank of Korea would lower the key rate. From Feb. 17 to 22, foreigners’ net purchase amounted to 289.5 billion won in the South Korean bond market.