[Anchor]

The KOSPI, which plummeted 21% over seven trading sessions, closed slightly higher yesterday (Oct. 16). However, the scale of forced liquidation for retail investors who bought stocks on borrowed money during the recent market plunge exceeded 80 billion won for the second consecutive day.

Here is more from reporter Lee Tae-gwon.

[Reporter]

The KOSPI has successfully rebounded after eight trading sessions.

Concerns over additional tightening eased following remarks by U.S. Federal Reserve Chair Kevin Warsh that he would not pre-judge interest rate decisions, driving the KOSPI up by more than 4% at one point to surpass the 5,800 mark.

However, weighed down by selling pressure from retail investors and institutional institutions late in the session, the index gave up some of its gains and closed up 2% at 5,668.

Foreigners, who had continued a selling spree, turned net buyers for the first time in nine sessions by purchasing 340 billion won yesterday.

Samsung Electronics and SK Hynix rose 2.6% and 0.8%, finishing at 215,500 won and 1,272,000 won, respectively.

The KOSDAQ, where a buy sidecar was triggered amid a sharp surge, closed up 4.4% at 794.

The rebound is interpreted as the influx of some bargain-hunting demand driven by the perception that the recent market drop had been excessive.

However, the KOSPI's rebound was limited compared to its record 21% plunge over the previous seven sessions, and foreigners' net buying volume was considered minimal compared to their average daily offloading of 2 trillion won.

[Interview / Lee Jin-woo, Head of Research Center, Meritz Securities: "The rebound itself can be seen as having a rather strong characteristic of a typical technical bounce. For now, we can still find significance in the market calming down somewhat."]

Losses continue to mount for retail investors who bought stocks on credit amid the recent downturn in the domestic stock market.

The volume of forced liquidations—where holdings are automatically sold off due to insufficient margin—was tallied at approximately 80.5 billion won the day before yesterday, topping 80 billion won for two straight days.

The government stated that the domestic stock market is exhibiting higher volatility than other markets due to differences in sector weightings, adding that it will monitor whether the impact of stock market volatility spreads to the bond or foreign exchange markets.

(Photo: Seol Chi-hwan, Video Editing: Kim Jong-tae, VJ: Lee Ji-hwan, Design: Yang Gi-tae)