Korean bourses on rollercoaster ride on coronavirus

SEOUL, Feb. 11 (Yonhap) -- The South Korean stock markets have been on a rollercoaster ride this year amid the new coronavirus scare, with the key price index's volatility hitting an eight-month high in January, data showed Tuesday.

The daily volatility of the benchmark Korea Composite Stock Price Index (KOSPI) averaged 1.27 percent this year as of Friday, far higher than last year's 0.94 percent, according to the data from the Korea Exchange.

In particular, the KOSPI's average daily volatility stood at 1.17 percent in January, its highest level since the 1.27 percent recorded in May last year.

The average daily volatility of a price index is calculated by dividing the difference between its daily highs and lows by the mean of its highs and lows.

After a strong start driven by semiconductor makers, the KOSPI suddenly began to seesaw due to high tensions in the Middle East and the Chinese coronavirus.

The KOSPI turned more volatile in February, with its daily volatility averaging 1.61 percent in the first six trading sessions.

The tech-heavy, secondary stock market was no exception. The KOSDAQ's average daily volatility this year stood at 1.52 percent on Friday, compared with 1.31 percent for all of 2019.

In January, the KOSDAQ's daily volatility reached a five-month high of 1.48 percent, with the figure rising to 1.64 percent this month.

Analysts predicted the South Korean bourses to remain highly volatile for the time being due to jitters over the new corona virus.

"The South Korean stock markets may suffer rollercoaster sessions in the short term as worries over the novel coronavirus linger," said Lee Young-gon, an analyst at Hana Financial Investment.

China's death toll from the new coronavirus epidemic passed the 1,000 mark Tuesday. South Korea has 27 confirmed cases.
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