Due to Cyclical Rallies and Ample Liquidity

Korea Exchange announced on June 14 that the average daily trading value in KOSPI was 13,855.6 billion won for the first 10 trading days of this month. On June 11, the sum of those in KOSPI (16,987.1 billion won) and KOSDAQ (13,508.5 billion won) topped 30 trillion won for the first time ever.

The increase in trading value resulted from cyclical rallies. The value stood at approximately 6.5 trillion won in January and February and rose to over 10 trillion won in March and April. The figure was 9,957.3 billion won last month. Although the highest daily trading value in KOSPI until May this year was 14,479.2 billion won recorded on May 28, the value topped 16 trillion won three times for the first 10 trading days of this month with some investors taking profits after the latest KOSPI rally and changing their portfolios as bank, shipbuilding and steel stocks joined the rally somewhat belatedly.

Last year, KOSPI remained stuck between 1,900 and 2,200 points and its average daily trading value stood at 4,989.6 billion won. The value fell 24 percent from the previous year and fell below five trillion won for the first time in three years. However, the current high trading value is likely to continue for a while as unprecedentedly expansionary monetary and fiscal policies are leading to abundant liquidity in the stock market.


 

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