KOSPI Falls Over 1% Amid 'DeepSeek Aftershock'... Exchange Rate Surpasses 1,450 Won

Foreigners Net Sell 834.7 Billion Won in the Stock Market

The KOSPI index is showing a decline of over 1% due to the shock from the Chinese AI startup DeepSeek. The won-dollar exchange rate has also surpassed 1,450 won again.

As of 11 a.m. on the 31st, the KOSPI is down 27.23 points (1.07%) from the previous trading day, recording 2,509.57. The index fell to 2,498.9 at one point in early trading but quickly recovered to the 2,500 level.

In the stock market, foreigners are net selling 834.7 billion won alone, dragging down the index. Individuals and institutions are net buying 576.9 billion won and 246.5 billion won, respectively.

The top stocks by market capitalization on the KOSPI are showing mixed trends. SK hynix (-9.59%) and Samsung Electronics (-2.42%) are both weakening due to the DeepSeek shock. DeepSeek has shocked the industry by introducing an AI model that surpasses OpenAI's ChatGPT at only one-tenth the cost of U.S. big tech Meta. There is speculation that if DeepSeek's cost-effective AI model development method spreads, fewer NVIDIA AI chips will be needed.

On the other hand, Naver (5.88%) is classified as a beneficiary of DeepSeek and is surging. There is a forecast that if open-source models like DeepSeek succeed, Naver's cost of developing AI models will decrease. Other rising stocks include KB Financial Group (2.7%), Meritz Financial Group (2.65%), Shinhan Financial Group (2.2%), and HD Hyundai Heavy Industries (1.16%).

The KOSDAQ index is down 4.17 points (0.57%) from the previous session, indicating 724.57. The KOSDAQ index is staying around the 720 level during the session.

In the KOSDAQ market, foreigners are net selling 62.2 billion won alone. Individuals are net selling 68.4 billion won.

The flow of top stocks by market capitalization on the KOSDAQ is also mixed. HPSP (-6.66%), LIG Nex1 (-1.39%), Ligochem Bio (-1.31%), and Enchem (-0.9%) are declining. Meanwhile, Samchundang Pharm (4.19%), Shinsung Delta Tech (3.82%), Rainbow Robotics (3.64%), Classys (2.05%), HLB (1.14%), and Hugel (1.08%) are rising.

The won-dollar exchange rate has surpassed 1,450 won again. It is currently trading at 1,455.2 won, up 23.8 won from the previous trading day.

The U.S. Federal Reserve (Fed) kept the policy rate unchanged at 4.25~4.5% at the Federal Open Market Committee (FOMC) regular meeting on the 29th (local time). On the other hand, the European Central Bank (ECB) lowered the policy rate from 3.15% to 2.90%. This is the fourth consecutive rate cut since September last year. As a result, there is an analysis that the dollar's strength against major currencies is expanding.

Jin Young-ki, Hankyung.com reporter young71@hankyung.com