Trading value plunges on Brexit woes

[THE INVESTOR] The value of daily share trading on the Korean stock market has significantly declined in July as market volatility has spiked in recent weeks due to the UK’s decision to leave the European Union, following an upward trend during the second quarter this year, according to the local bourse operator Korea Exchange on July 7.

Average daily trading value of the benchmark KOSPI and the tech-heavy KOSDAQ stood at 8.46 trillion won (US$7.3 billion) during the first six days of July, down 7.15 percent, or 650 billion won, from 9.11 trillion won in June. 

It is the biggest decline this year after the figure started to recover from April.

“Stock market trading value is hugely influenced by investors’ prospects,” said Hwang Se-woon, head of capital market research at the Korea Capital Market Institute.

“The value of shares traded on the Korean market had recovered since March as investors shrugged off concerns over a hard landing of the Chinese economy but it is sinking to new depths on Brexit anxiety,” he said.

The KOSPI market drove the plunge in value of shares in July as individual investors are selling off heavyweight stocks.

The value of daily transactions on the KOSPI market tumbled to 4.27 trillion won in July from 5.19 trillion won in June.

Stocks traded on the KOSDAQ this month were valued at 4.18 trillion won, up 6.88 percent from 3.91 trillion won last month.

By Park Han-na (hnpark@heraldcorp.com)