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A trader can be seen working in Hana Bank’s dealing room in downtown Seoul on Sept. 23, with the closing figures for KOSPI and the exchange rate shown on monitors in the background. (Yonhap)

Around 620 trillion won in market capitalization went up in smoke on the KOSPI and KOSDAQ markets in their steep plunges over the past year.

At 34%, the KOSPI’s decline in terms of US dollar value this year has been the sharpest for the major indexes among G20 countries.

With a rapid rise in individual investors departing the market as interest rates have risen, customer deposits were at their lowest in two years.

The Korea Exchange reported Sunday that the KOSPI and KOSDAQ had respectively finished at 2,290.00 and 729.36 points on Friday.

The KOSPI’s closing price was down by 1,015.21 (30.7%) from its historic peak of 3,305.21 on July 6, 2021. In that period, market capitalization dropped from 2,314,417,400,000,000 won to 1,804,500,000,000,000 won — a decline of 509.9174 trillion won.

The KOSDAQ was down by 330.64 points (31.2%) from its closing price high of 1,060.00 on Aug. 9, 2021. Market capitalization fell over that period from 443.086 trillion won to 332.9038 trillion won, a drop of 110.1822 trillion won.

Together, market capitalization for the two indexes was down by 620.0996 trillion from their respective peaks.

Around 159.3932 trillion won in market capitalization evaporated with a 32.9% decline in Samsung Electronics share prices, which slid from 81,200 won on July 6 of last year to 54,500 won.

Another 30 trillion won decrease in market capitalization resulted from a 33.2% adjustment in SK Hynix share prices, while a combined total of over 75 trillion won was lost in Kakao and Naver market capitalization.

As of Friday, foreign investors had recorded net sales of 16.7547 trillion won this year on the KOSPI (12.3216 trillion won) and KOSDAQ (4.4331 trillion won).

With the won-to-dollar exchange rate passing 1,400, the dollar-converted KOSPI experienced a sharper decline than the won-denominated KOSPI. According to Daishin Securities and Bloomberg, a comparison of dollar-converted indexes for major G20 countries’ indexes between early 2022 and Sept. 22 showed the KOSPI registering the biggest decline at 33.58%. The next biggest drops were observed in Germany (-31.79%), Italy (-31.45%), and the Euro Stoxx 50 (-31.01%).

Over the same period, the US’ S&P 500 fell by 21.65%, Japan’s Nikkei 225 slid by 24.38%, and China’s Shanghai Composite Index sank by 22.94%.

At 21.96%, the won-denominated KOSPI’s decline was similar to those in Germany (-21.78%), Italy (-21.39%), and the European Union (-20.88%), but the KOSPI’s rate was larger when it was converted into dollars.

By Cho Kye-wan, senior staff writer

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