Two days after the resumption of short selling, stock prices rebounded and the amount of short selling transactions decreased considerably, while the number of short selling and overheated stocks also dropped sharply, raising expectations that the stock market could quickly regain stability.
According to the Korea Exchange on the 5th, the number of short-selling overheated stocks on the 4th was only two cases: Cha Biotech and Jusung Engineering.
This is less than 2.8, which is the number of overheated short-selling stocks designated annually in 2019.
On the 3rd, the first day of resumption of short selling, 22 stocks including Shinpoong Pharmaceutical, Doosan Fuel Cell, and Lotte Holdings were designated as overheated stocks, but significantly reduced to a tenth level.
The securities market and KOSDAQ short sale transaction amount, which reached KRW 1.1 trillion on the 3rd, also decreased by 19.6% from the previous day to 892 billion KRW on the 4th.
The amount of short selling transactions by foreigners leading short selling decreased by 21.3% to KRW 7649 billion.
As the momentum of short selling is weaker than on the first day, the stock market is also in an atmosphere of escaping hits.
On the 3rd, short selling was relatively concentrated on the KOSDAQ bio stocks, and the KOSDAQ index plunged 2.20%, but on the 4th it rebounded by 0.56%.
The KOSPI, down 0.66% on the 3rd, closed up 0.64% on the 4th, making up for a significant portion of the previous day's decline.
In this regard, the ban on short selling for a day on the 4th for 22 short-selling overheated stocks designated on the 3rd seems to have helped stabilize the market.
However, among the stocks that were sold normally regardless of the designation of overheated stocks, there were a number of stocks that fell sharply due to the effect of short selling on the 3rd and then rebounded on the 4th.
Celltrion (+4.21%), Celltrion Healthcare (+4.45%), and Celltrion Pharmaceutical (+3.01%), which were mentioned as vulnerable short-selling stocks, rose at once after a sharp decline a day ago.
SK Innovation (+7.05%), Samsung SDI (+1.72%), LG Chem (+1.43%), three battery companies, Kakao Games (+3.09%), and HLB (+4.73%) also reversed in a day.
There is no clear problem with the underlying conditions (fundamental) of the overall stock market, and some interpreted that investor sentiment on the first day of short selling resumed somewhat overreacting and then began to find stability.
However, as short selling of 22 overheated stocks resumed on the 6th, the impact on the market should be noted if these stocks continue to decline again.
(Photo = Yonhap News)