On the 4th, President Lee Jae-myung took office and the KOSPI index rose by more than 2%. The stock price broke the jinx of declining on the first day of a presidential inauguration for the first time in 17 years.
The KOSPI index closed at 2770.84 on this day. It rose by 71.87 points (2.66%) compared to the previous transaction day, reaching its highest point since last August. This is the second time since democratization that the KOSPI index has risen on a presidential inauguration day, following President Lee Myung-bak's (1.34%). The increase was the largest this time.
Previously, the KOSPI index closed lower on the inauguration days of presidents: President Roh Tae-woo -3.3%, President Kim Young-sam -2.56%, President Kim Dae-jung -4.53%, President Roh Moo-hyun -3.9%, President Park Geun-hye -0.46%, President Moon Jae-in -0.99%, and President Yoon Suk-yeol -0.55%.
President Lee Jae-myung's emphasis on the 'KOSPI index 5000 era' seems to have helped boost investor sentiment. Shinhan Investment Corp researcher Lee Jae-won noted, 'President Lee has publicly professed aggressive market support, and the expectations for a reassessment of valuation due to amendments to the Commercial Act seem to be strongly reflected.'
The drop in the exchange rate of the won against the U.S. dollar also contributed to foreign investors 'buying'. Foreigners showed a selling advantage of 1.05 trillion won in the KOSPI market that day, the largest net purchase scale in 10 months. Foreigners also bought nearly 500 billion won in KOSPI futures.
After one month of the presidential inauguration, stock prices rose 5 out of 8 times from President Roh Tae-woo to President Yoon Suk-yeol. In the short term, the scheduled call between U.S. President Donald Trump and Chinese President Xi Jinping on the 6th is expected to influence market trends. In the medium to long term, the scale of the supplementary budget and the speed of fulfilling promises are seen as key factors.