More stocks fall despite Kospi rally amid chip-sector concentration

More stocks listed on the benchmark Kospi have declined than advanced in recent weeks despite the market rally, the bourse operator said Sunday, suggesting that investment is increasingly concentrated in a handful of heavyweight semiconductor stocks.

According to the Korea Exchange (KRX), an average of 210 Kospi-listed stocks advanced, while 586 declined and the remainder were unchanged during the two weeks from May 26 through Friday.

The trend came even as major market heavyweights posted strong gains.

Shares of top-cap Samsung Electronics and its chipmaking rival SK hynix rose 13.72 percent and 14.32 percent, respectively, over the cited period.

On May 27, the Kospi jumped 2.55 percent, but only 72 stocks advanced. In comparison, 713 stocks rose on May 22, when the Kospi posted a modest 0.41 percent gain, according to the KRX.

When the Kospi closed 1.84 percent lower Thursday, 400 stocks advanced, outnumbering 389 decliners.

“The current market concentration cannot be explained solely by investor sentiment," said Noh Dong-gil, an analyst at Shinhan Securities. "Samsung Electronics and SK hynix have evolved beyond market leaders to become common underlying assets across a wide range of financial products."

The divergence has fueled expectations that investors will continue to concentrate on a handful of top-cap chip leaders that are driving the Kospi rally.

Yonhap