Kosdaq Slides 2.68% as Institutions Dump Chip Supply-Chain Stocks

Institutions Post Net Sales of 300.6 Billion Won in a Day

South Korea’s Kosdaq index fell on May 29 as institutions sold semiconductor materials, parts and equipment companies. The selling was driven by heavy outflows from existing semiconductor exchange-traded funds after the launch of single-stock leveraged ETFs tied to blue-chip names including Samsung Electronics Co. and SK Hynix Inc.

The Kosdaq closed at 1,074.80, down 2.68% from the previous session. It fell for a third straight trading day. Institutions were net sellers of 300.6 billion won, while foreigners sold a net 17.5 billion won. Retail investors bought a net 310.2 billion won, but failed to stem the decline. Of 1,745 listed stocks, 1,393 fell.

Attention is centered on shifting flows in semiconductor shares. The investment landscape for the sector has changed rapidly with the recent launch of leveraged ETFs that track Samsung Electronics and SK Hynix at twice their daily performance.

Retail investors have been selling existing semiconductor ETFs such as the KODEX Semiconductor Leverage ETF and moving into single-stock leveraged products. That triggered broad-based selling in materials, parts and equipment names held by those sector ETFs. Of the 36 stocks included in KODEX and TIGER semiconductor ETFs, 34 — excluding Samsung Electronics and SK Hynix — fell more than 10% over two days.

Park Ju-yeon and Kang Jin-kyu, Hankyung.com reporters grumpy_cat@hankyung.com