The KOSPI is rebounding after seven straight sessions of losses. All 20 of the market's largest stocks by market capitalization were higher in early trading, with some gaining more than 5%. On Wall Street overnight, the three main U.S. indexes all closed higher as Treasury yields fell.
As of 9:10 a.m. on the 16th, the KOSPI stood at 5,632.38, up 78.16 points, or 1.41%, from the previous session, according to the Korea Exchange. The index opened at 5,653.99, up 99.77 points or 1.80%, and has held its gains. The KOSDAQ was also higher at 766.50, up 5.68 points or 0.75%.
Most large-cap stocks advanced. Samsung Electronics traded at 213,750 won, up 1.79%, while SK hynix changed hands at 1,283,000 won, up 1.66%. Other heavyweights also rose, including SK Square, up 1.05%, Samsung Electro-Mechanics, up 2.75%, and Hyundai Motor, up 2.54%. At that time, all 20 of the KOSPI's biggest stocks were trading in positive territory.
U.S. stocks rebounded overnight on the back of falling Treasury yields. The Dow Jones Industrial Average closed 1.08% higher at 52,177.69, and the Standard & Poor's 500 ended up 0.33% at 7,744.06. The technology-heavy Nasdaq Composite finished 0.08% higher at 26,713.03. Caution toward artificial intelligence-related technology shares persisted, but money rotated into other sectors, lifting consumer-goods companies in particular. An improving economic outlook also supported the rebound, with the yield on the 10-year U.S. Treasury note falling to 5.086%.
That has fueled expectations of a rebound in the KOSPI. The index closed the previous session at 5,554.22, down 454.59 points or 7.57%, in what was dubbed a "Black Thursday." On a closing basis, it fell below the late-July low of 5,593.56 to its weakest level since 5,494.78 on April 7. The KOSPI has now declined for seven consecutive sessions, the first such streak since Sept. 3-11, 2024, two years and one month ago. Brokerages see the scale of the selloff as excessive relative to the earnings fundamentals of Korean companies.
So far this month, the Korean market has fallen 18.8%, a steeper drop than in Japan, down 3.5%, or Taiwan, down 2.0%. Based on final earnings through the second quarter of this year, the KOSPI's price-to-earnings ratio (PER) has fallen to about 8 times. That is similar to levels seen during macroeconomic crises such as the 2003 credit-card debt crisis, the 2008 global financial crisis and the 2020 COVID-19 pandemic.
