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Kospi cushions losses from Wall Street plunge

South Korea’s main stock bourse Kospi slipped 2 percent Friday in its biggest daily loss in over a month, as stock markets in the United States took another major blow due to resurfacing coronavirus woes.

Kospi closed at 2,132.30 on Friday. Losers outnumbered gainers 720 to 160.

As numbers of infections rose in some of the states that have reopened, including Texas and Arizona, both stocks and crude tumbled in the US on Thursday. The Dow Jones Industrial Average plummeted 6.9 percent, S&P 500 sank 5.9 percent and the Nasdaq Composite Index tanked 5.3 percent.

Immediately as the Seoul bourse opened, Kospi took a 4.2 percent loss at its lowest point in the morning session.

The market, however, gradually mitigated that loss by the afternoon on the back of retail investors’ strong net buying. Retail investors net purchased shares worth 558.9 billion won ($464.6 million), but fell short of offsetting the net sales of foreign investors and institutional investors.

Analysts said the Friday session tested retail investors’ buying momentum, which -- along with restrictions on short selling activities -- prompted the stock market recovery here from the coronavirus fallout that had depressed it since mid-March. Kospi rose over 16 percent over the course of three months, as of Friday.

“Korean stock buyers’ upward push carried on despite the sharp fall earlier in the morning,” said Kim Hyoung-ryoul, head of research at Kyobo Securities.

Market bellwether Samsung Electronics fell 3.7 percent, while chipmaker SK hynix slid 3.7 percent.

Some market giants defied gravity. Biopharmaceutical firm Samsung Biologics gained 7.8 percent, while Celltrion, which announced the takeover of Takeda Pharmaceutical’s drugs in the Asia-Pacific market Thursday, soared 3.3 percent. Internet giant Naver edged up 0.6 percent, while its rival Kakao inched up 0.4 percent. SK Holdings jumped 8.6 percent.

The development board Kosdaq showed a similar pattern in the Friday session, reducing its loss to 1.5 percent in the closing, from 3.1 percent in the early morning session. The Korean won weakened 0.6 percent Friday against the greenback, as the local currency was trading at 1,203.8 won to every dollar.

By Son Ji-hyoung (