Korea's stock market turnover soars on liquidity-driven rally

SEOUL, Aug. 14 (Yonhap) -- South Korea's daily stock market turnover has spiked more than 30 percent this month from July thanks to a liquidity-driven rally, data showed Friday.

The combined turnover of the main KOSPI and secondary KOSDAQ markets averaged 31.2 trillion won (US$26.3 billion) per day in the first 13 days of August, up 31 percent from the prior month, according to the data from the Korea Exchange.

The daily average turnover even soared to an all-time high of 33 trillion won on both bourses on Tuesday.

Market watchers attributed the surge to a liquidity-driven market centering around retail investors. South Korean shares closed higher for the ninth straight session on Thursday, with the benchmark Korea Composite Stock Price Index (KOSPI) renewing yearly highs continuously.

Money invested by individual investors accounted for 72.8 percent of the stock market turnover this month, up 72.5 percent in July.

"The bullish run of the local bourses has been attracting a large amount of market liquidity, especially from retail investors," said Lee Young-kon, an analyst at Hana Financial Investment Corp.

Lured by the stock market rally, individual investors have been taking out more loans from brokerage houses to purchase shares.

Outstanding margin loans to retail investors stood at 15.4 trillion won as of Thursday after breaching the 15 trillion-won level a week ago, according to the Korea Financial Investment Association.
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