Kospi Holds 7,000 Despite Quadruple Witching, Semiconductor Rebalancing

Parts, Materials Stocks Including TSE Surge

Samsung, SK Hynix Buybacks Help Cushion Losses

South Korea’s benchmark stock market was expected to swing sharply as quadruple witching coincided with large-scale ETF rebalancing, but the Kospi still managed to hold above 7,000. The Kosdaq ended higher as some semiconductor parts, materials and equipment stocks, including Jusung Engineering and TSE, posted sharp gains.

The Kospi closed down 0.25% at 7,033.92 on September 10. The index fell as low as 6,898.45 at one point, but cut its losses in afternoon trading and defended the 7,000 level. Foreign investors were net sellers of 2.7504 trillion won ($1.99 billion), while retail investors and institutions were net buyers of 1.0931 trillion won ($792 million) and 3.6 billion won ($2.6 million), respectively. Other corporations were net buyers of 1.6496 trillion won ($1.19 billion). Retail investors turned net buyers for the first time in six trading days, while institutions extended their net-buying streak to six sessions.

Among large-cap stocks, Samsung Electronics fell 0.19% and SK Hynix lost 0.16%. Both shares recouped most of their intraday declines after falling more than 2% earlier in the session.

The securities industry had expected steeper declines in the two chipmakers on September 10 as stock index futures and options expired on the so-called quadruple witching day, while large-scale ETF rebalancing took place ahead of a regular reshuffle of KRX sector indexes. In the KRX Semiconductor Index, SK Hynix’s weighting had risen to the 36% range, while Samsung Electronics’ had climbed to the 22% range. Because the regular reshuffle caps each constituent at 20%, the market had expected heavy mechanical selling as the two stocks’ weightings were reduced. Buybacks by Samsung Electronics and SK Hynix, however, helped other corporations support the market’s downside.

Oil refining and shipping stocks also helped defend the index. As geopolitical tensions in the Middle East escalated and Brent crude rose above $100 a barrel, buying poured into Korea Petroleum, which jumped 10.30%, and Heung-A Shipping, which gained 8.01%.

The Kosdaq closed up 0.79% at 836.92. The advance was driven by sharp gains in semiconductor parts, materials and equipment stocks centered on Jusung Engineering and TSE, whose weightings in the KRX Semiconductor Index increased. Jusung Engineering rose 7.02% and TSE soared 14.15%. TES, newly added to the index that day, also edged up 0.39%. Among major Kosdaq stocks, EcoPro BM climbed 3.31%, Simmtech added 0.98% and Fadu advanced 6.59%, helping lift the index. By contrast, other parts, materials and equipment names including Wonik IPS, down 1.08%, and EO Technics, off 3.19%, fell.

Oh Hyun-ah, Hankyung.com reporter 5hyun@hankyung.com