[Edaily Reporter kyoungeun kim ] On the 2nd, the KOSPI closed up more than 2% as institutional buying and share buybacks provided support against a downward trend, despite the aftershocks of last weekend’s sell-off in U.S. artificial intelligence (AI) stocks.

According to MP Doctor, the KOSPI closed at 5,859.08 today, up 128.34 points (2.24%) from the previous trading day. The index briefly rose to 5,908.14 during the session, breaking through the 5,900 mark.

The KOSPI, which opened down more than 1% following a sharp drop in U.S. semiconductor stocks over the weekend, reversed course and began rising in the morning on the back of bargain-hunting, then extended its gains driven by institutional buying.

In the stock market, institutions led the index higher with net purchases totaling 1.2329 trillion won. Among them, “other corporations” accounted for 541.5 billion won, with share buybacks underpinning the market. Financial investment firms made net purchases of 685.1 billion won, and pension funds also contributed 169.9 billion won in net purchases, driving the market higher.

In contrast, retail investors and foreign investors were net sellers by 1.3475 trillion won and 373.1 billion won, respectively.

With 653 stocks rising and 230 falling, a broad-based rebound was seen across all sectors.

Kang Jin-hyuk, a senior researcher at Shinhan Investment Securities, said, “After approaching the 5,600 level, pension funds, financial investment firms, and other corporate entities provided support on the downside, and inflows continued even after pension funds recorded their second-largest-ever net purchase on the 30th of last month.” He added, “SK hynix’s share buyback also served as a factor supporting the market at the lower end.”

On this day, the Korea Exchange’s implementation of its first-ever system for publicly disclosing companies with low price-to-book ratios (PBR) also stimulated buying momentum. HYUNDAI STEEL(004020)surged by over 11.61%, and LOTTE SHOPPING CO., LTD.(023530)(9.28%) also posted strong gains. Buyers also snapped up shares of shipbuilding, defense, and power sector stocks—which had recently suffered sharp declines—on the back of bargain-hunting, and Hanwha Ocean(042660)(9.80%) rose on news of its first order to build a U.S. Navy vessel.

The top market-cap stocks closed higher, led by semiconductor stocks. SKSQUARE(402340)(+5.91%), SK hynix(000660)(+3.81%), SamsungElectronics(005930)(+1.78%), HyundaiMotor(005380)(+1.77%), SamsungElectronics(1P)(005935)(+1.67%), and Samsung Life Insurance(032830)(+0.55%) all rose.

Conversely, SAMSUNG BIOLOGICS(207940)(-4.37%), KB Financial Group(105560)(-1.35%), LG Energy Solution(373220)(-0.97%), and SamsungElectroMechanics(009150)(-0.25%) closed lower.

The securities industry is placing greater emphasis on the possibility of market normalization, as earnings-based valuations are providing downside support. Shin Seung-jin, an analyst at SamsungSecurities, said, “At this point, there is little benefit to selling,” adding, “It is important to build a portfolio that can withstand a temporary dip below the forward price-to-book (P/B) ratio of 1, even if the KOSPI falls below that level due to additional negative factors.” He added, “If tensions in the Middle East ease and oil prices fall below $90 per barrel, a new upward trend will form, and I see the KOSPI’s first target at the 7,300 level.”

Lee Kyung-min, an analyst at DaishinSecurities, said, “The forward price-to-earnings ratio (P/E) of 4.14x is the lowest level since 2001, so if the index fluctuates around the 5,500 level, it presents an opportunity to increase exposure,” and “In this ‘de-rating’ scenario—where earnings have risen but the PER has fallen—if discount rates and supply-demand dynamics return to normal, the KOSPI could reach its first target range of 6,600 to 6,700.”

The KOSDAQ closed at 734.36, up 9.98 points (1.38%). Institutional investors were net buyers of 62.3 billion won, while retail and foreign investors were net sellers of 26.0 billion won and 32.2 billion won, respectively. There were 1,115 gainers and 553 losers.

Most of the top KOSDAQ stocks by market capitalization also closed higher. SIMMTECH Co., Ltd.(222800) (+6.08%), HLB INC.(028300)(+4.25%), WONIK IPS Co.,Ltd.(240810)(+2.82%), ECOPRO CO., LTD(086520)(+2.22%), JUSUNG ENGINEERING Co.,Ltd.(036930)(+1.82%), ECOPRO BM CO., LTD.(247540)(+1.32%), LEENO Industrial Inc(058470)(+1.60%), Alteogen Inc.(196170)(+0.71%), and EO Technics Co., Ltd.(039030)(+0.77%) all rose. In contrast, Rainbow Robotics(277810)(-0.14%) closed slightly lower.

By sector, electrical equipment (6.77%), shipbuilding (6.06%), transportation (4.73%), and steel (4.63%) led the gains. In contrast, banking, other financial services, tobacco, securities, and pharmaceuticals were down by about 1%.