KOSPI Falls for Third Session as Foreign Investors Sell

South Korean stocks fell for a third consecutive session on November 9 as foreign selling outweighed institutional buying, despite bargain hunting in electrical and electronics shares.

The benchmark KOSPI closed down 40.84 points, or 0.81%, at 5,018.85, according to the Korea Exchange. The KOSDAQ fell 5.30 points, or 0.82%, to 638.97.

Foreign investors sold a net 656.1 billion won of KOSPI shares. Their net sales included 239 billion won in electrical and electronics stocks, 139.3 billion won in financials and 51.1 billion won in transport equipment and parts.

Retail investors sold a net 507.4 billion won, while institutions bought 703.2 billion won.

Securities shares fell 4.0%, while transportation and warehousing lost 3.6%. Transport equipment and parts declined 3.3%, and food, beverages and tobacco fell 3.2%.

Large-cap shares dropped 0.8% and mid-caps fell 1.3%, while small-caps gained 0.2%.

On the KOSDAQ, foreign investors sold a net 68.6 billion won and retail investors sold 45.3 billion won. Institutions bought 105.8 billion won.

Combined short-sale turnover across the two markets fell to 1.3617 trillion won, down about 507.5 billion won from the previous session. The decline was concentrated in the KOSPI, where short-sale turnover fell by 524.9 billion won. KOSDAQ short-sale turnover increased by 17.4 billion won.

Despite the lower combined value, short selling accounted for a larger share of trading in both markets. The KOSPI ratio rose to 4.24% from 3.60%, while the KOSDAQ ratio increased to 6.56% from 5.28%.

The figures show why a decline in short-sale turnover alone is insufficient to conclude that selling pressure has eased.

The won strengthened for the first time in three sessions. The exchange brief listed the dollar at 1,348.1 won, down 14.9 won from the previous session. The three-year Korean government bond yield rose 2.8 basis points to 3.640%, while the 10-year yield increased 1.1 basis points to 3.863%.