Monday, November 29

KOSDAQ with wings on NFT and metaverse craze… KOSPI is ‘gluttonous’

While the KOSPI is standing still in the box, the KOSDAQ has a clear upward trend. While the KOSPI, which has many large-cap stocks, was sluggish due to inflation concerns, non-fungible tokens (NFTs) and metaverse-related stocks were in the spotlight as new growth engines, leading the rise of the KOSDAQ.

According to the Korea Exchange on the 21st, the KOSDAQ index rose 5% from 992.33 to 1041.92 for three weeks from November 1 to 19. On the other hand, during the same period, the KOSPI rose only 0.01% from 2970.68 to 2971.02.

The KOSDAQ (450 trillion won) also surpassed the KOSPI (2192 trillion won), which is five times the market capitalization of listed stocks, in trading value. From the 1st to the 19th, the average daily trading value of the KOSDAQ was 12.35 trillion won and the KOSPI was 11.24 trillion won. The daily trading value of the KOSPI, which rose to 40 trillion won in January of this year, fell to the lowest 9 trillion won level since November. On the other hand, the daily trading value of the KOSDAQ has maintained more than 10 trillion won this month. On the 17th, it surpassed 16 trillion won for the first time in 9 months since February 18th.

It was the KOSPI, where large-cap stocks such as Samsung Electronics, which heated up the stock market earlier this year. On January 7th, the KOSPI broke the 3,000 mark for the first time in history and continued its high streak, but in July it was locked in the box due to the re-spread of Corona 19. On the other hand, the KOSDAQ has outperformed the KOSPI in monthly returns for five consecutive months since June. The yield so far this year has been 7.59 on the KOSDAQ, more than double that of the KOSPI (3.39%).

Digital contents, IT software and services, and entertainment and culture industries are driving the KOSDAQ upward trend. In this month, the growth rates of these industries were 28.90%, 21.28% and 13.99%, respectively. By stock, stock prices of NFT and Metaverse-related stocks soared. Gamevil, an NFT platform company, and Galaxy Armory Tree, a game company that announced their entry into the NFT game market, rose 108.76% and 103.30%, respectively, for three weeks. The stock price of Dexter, a visual special effects company related to Metaverse, rose 79.92%. The surge in rechargeable battery material stocks also boosted the KOSDAQ index.

As concerns about inflation and corporate earnings peak-out (a decline after passing a high) grow, funds appear to be moving from the KOSPI, which is sensitive to these factors, to the KOSDAQ, which has many NFT and Metaverse-related stocks. Lee Kyung-soo, a researcher at Hana Financial Investment, said, “Recently, the forecast for next year’s earnings has been sharply downgraded, so the relative bullish atmosphere between mid-cap stocks and the KOSDAQ is bound to continue. Choi Yoo-jun, a researcher at Shinhan Financial Investment, said, “Games and metaverses are attracting investors’ attention as alternatives to macroscopic uncertainty.

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