▲ The Kospi and individual stock indices are displayed at the Korea Exchange in Yeouido, Seoul, on the 13th. (Photo: Yonhap News)
The Korea New-Type Fear Index, the Kospi 200 Volatility Index (VKOSPI), is surging by more than 23% today (the 13th).
Amid a relentless plunge, the total market capitalization of the Kospi has fallen back to the 4,000 trillion won range for the first time in about two and a half months.
As of 1:00 p.m. today, the Kospi index is down 407.90 points (6.39%) from the previous session at 5,976.34.
The index opened at 6,186.08, down 198.16 points (3.10%) from the previous session, but widened its losses and eventually relinquished the 6,000 threshold.
Immediately after the market opened, a Kospi sell sidecar (temporary suspension of program trade sell orders) was triggered for the first time in about two and a half months since August 19.
The Kosdaq index also fell 30.59 points (3.6%) from the previous session to 818.60, barely holding onto the 800 mark.
The VKOSPI, known as Korea's fear index, is currently recording 50.24, a sharp increase of 23.35% from the previous session.
This growth rate is the largest since March 4 (27.61%).
This indicates that investors expect significant market volatility ahead.
The total market capitalization of the Kospi currently stands at 4,929 trillion won.
If the market closes at this level, the Kospi market cap will fall below the 5,000 trillion won mark for the first time in about two and a half months since July 30.
This is largely attributed to the steep decline in Samsung Electronics and SK Hynix, which account for nearly half of the Kospi's total market capitalization.
Today, Samsung Electronics dropped 7.88% and SK Hynix fell 8.94%, marking a downward trend for five consecutive trading sessions.
If the Kospi closes lower today as well, it will mark the first five-day consecutive decline since the period between December 24, 2024, and January 2, 2025.
Unlike the usual pattern where a continuous drop in indices prompts bargain-hunting inflows for a rebound within the near future, such a trend is absent this time.
Instead, the downward momentum is intensifying.
From the 6th until yesterday, the daily decline rates of the Kospi were 0.89%, 1.98%, 2.62%, and 3.65%.
Seo Sang-young, a senior managing director at Mirae Asset Securities, pointed out, "(The decline in Asian stock markets including Korea is) the result of combined concerns over the profitability of artificial intelligence (AI) investments and the reduction of global risky asset allocations."
Kim Seok-hwan, a researcher at Mirae Asset Securities, stated, "Foreign investors have already net sold approximately 200 trillion won in the Kospi this year, and selling pressure has continued into this month," adding, "For stock prices to rebound, we need to see changes in foreign supply and demand, U.S. long-term interest rates and domestic discount rates, and the maintenance or upward revision of next year's semiconductor earnings estimates."
(Photo: Yonhap News)
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