South Korea’s benchmark Korea Composite Stock Price Index (KOSPI) hit a three-month closing high on Tuesday as foreign investors, who had been net sellers of Korean shares after the spread of COVID-19, made a net purchasing of local shares. The KOSPI closed at 3,220.70, up 21.86 points from the previous day, breaking its previous record of 3,208.99 set on Jan. 25. The index reached an all-time high of 3,266.23 on Jan. 11.
Tuesday’s bullish run was driven by foreign and institutional buying. The KOSPI began at 3,198.31, down 0.53 points from the previous day, but surpassed the 3,200 mark on the back of foreign and institutional buying. In particular, the index has extended gains for the seventh consecutive session since April 12. Foreign and institutional investors made a net purchase of 327.8 billion won and 46.4 billion won, respectively. On the other hand, individual investors sought profit-taking, making a net selling of 389.8 billion won.
Experts say the index’s rise was spurred by stabilization of won-dollar exchange rate and expectations of an economic recovery. The won-dollar exchange rate fell to 1112.3 won from 1142.0 won on March 10. Some say this is the reason why foreign investors, who had net sold local stocks in the first quarter of this year, have turned to net buying from late last month.
Meanwhile, KOSDAQ closed at 1,031.88, up 2.42 points, or 0.24 percent, from the previous session’s close.