Seoul:South Korean stocks fell by nearly 2 percent on Wednesday, marking a second day of losses driven by declines in technology shares and concerns over rising bond yields, which have reached multidecade highs. Meanwhile, the Korean won strengthened against the U.S. dollar.
According to Yonhap News Agency, the Korea Composite Stock Price Index (KOSPI) closed down 137.49 points, or 1.98 percent, at 6,803.90. The index initially opened 1.11 percent lower, briefly turned higher, but finished the day down as investors remained wary of high bond yields.
Despite gains on Wall Street the previous night, local shares fell. While global oil prices decreased due to easing supply concerns, bond yields retreated slightly from their highs. The Dow Jones Industrial Average increased by 0.49 percent, and the Nasdaq composite rose 0.45 percent to reach a record.
Trading volume was light, with 256.76 million shares worth 19.69 trillion won (US$14.68 billion) changing hands. Decliners outnumbered advancers 525 to 332. Foreign investors and institutions sold a net 2.59 trillion won and 672.7 billion won, respectively, while individual investors bought a net 2.56 trillion won.
Lee Kyung-min, an analyst at Daishin Securities, noted that the KOSPI faced pressure from rising international oil prices and U.S. Treasury yields. Investor caution ahead of Samsung Electronics' upcoming earnings report also led to net selling by foreign and institutional investors.
Market heavyweights ended the day lower. Samsung Electronics dropped 1.29 percent to 268,500 won, and SK hynix fell 2.82 percent to 1.72 million won. SK Square, the parent of SK hynix, decreased 1.64 percent to 1.14 million won, while Samsung Electro-Mechanics declined 4.24 percent to 1.6 million won.
The Korean won was quoted at 1,340.4 against the U.S. dollar as of 3:30 p.m., showing a slight strengthening from the previous session's close of 1,343.6 won. Bond prices, which move inversely to yields, closed lower, with the yield on three-year Treasurys increasing by 2.8 basis points to 3,961, and the five-year government bonds yield rising by 1.7 basis points to 4.134.