Stocks Jump to Pre-Impeachment Level

Yesterday, the KOSPI (Korea Composite Stock Price Index) jumped by more than 22 points, and went back to a higher figure than the day before the passage of the president’s impeachment motion.

The won-dollar exchange rate dropped to 1,164 won, and with the steady increase of the won, the finance market is stabilizing quickly.

The KOSPI at the Seoul Stock Market rose by 22.25 points (2.62 percent) from yesterday’s closing price and closed at 872.38. This figure is 2.45 points higher than the closing price in March 11, the day before the impeachment motion passage against the president.

With the US stock market rallying on the Federal Reserve Board (FRB)’s policy to freeze interest, and foreigners turning into net buyers (approximately 5.8 billion won) in just one day, these had an effect as big positives.

Foreigners who hold a sizable proportion of blue-chip stocks did not sell much after the impeachment shock and stayed on the sidelines, contributing to mental recovery. Advancing stocks, including 12 at their maximum price, exceeded declining stocks 582 to 160.

With the strong demand of foreigners for blue-chip companies, Samsung Electronics rose by more than three percent to 545,000 won, recovering the 540,000 won level in seven days.

At the Seoul foreign exchange market, the won-dollar currency mark dropped 6.6 won (the won increases) from the day before and closed at 1164.1 won. This figure was also lower than March 11 (1169.0 won).

The increasing won resulted as the yen was bullish towards the dollar and foreigners increased their stock of dollars to purchase Korean stocks.

Kang-Woon Lee Joong-Hyun Park kwoon90@donga.com sanjuck@donga.com