Seoul stocks dip almost 1 pct on growing woes over Fed rate hikes
SEOUL– South Korean stocks slipped back into negative territory again Wednesday, as investors took to the sidelines ahead of a widely expected sharp rate hike by the Federal Reserve. The Korean won fell against the dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) lost 20.64 points, or 0.87 percent, to close at 2,347.21.
Trading volume was light at 367.1 million shares worth 6.2 trillion won (US$4.4 billion), with losers outpacing gainers 580 to 279.
“Today’s losses came as investors refrained from buying risky assets as they keep an eye on the results of the Fed’s policy meeting,” analyst Han Ji-young from Kiwoom Securities said.
The stock market could tumble sharply if the Fed delivers a higher-than-expected rate forecast through the end of 2025. The Fed is scheduled to announce its rate decision on Wednesday (U.S. time).
“This year and next year’s top-line figures will be important. A figure over 4.5 could send shock waves into the local stock market,” analyst Kim Dae-jun of Korea Investment & Securities said.
Foreign investors offloaded a net 273.3 billion won worth of stocks, while institutional investors sold off a net 65.8 billion won worth of shares. Retail investors scooped up a net 325 billion won.
In Seoul, large-cap shares traded lower across the board.
Market bellwether Samsung electronics lost 0.9 percent to 55,300 won, marking the lowest price since Sept. 2 in 2020. Major chip maker SK hynix stayed flat at 88,000 won.
Battery maker LG Energy Solution slid 0.83 percent to 479,000 won and Samsung SDI dipped 2.37 percent to 619,000 won at the closing bell.
Top internet portal operator Naver declined 2.29 percent to 213,000 won, and top mobile messenger operator Kakao lost 1.99 percent to 64,000 won.
Major shipbuilder Daewoo Shipbuilding & Marine Engineering jumped 8.93 percent to 21,350 won amid heightened anticipation that the company’s privatization would gather steam down the road.
The local currency ended at 1,394.2 won against the U.S. dollar, down 4.7 won from Tuesday session’s close.
Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys added 2.4 basis points to 3.847 percent and the return on the benchmark five-year government bonds jumped 7.5 basis points to 3.905 percent.
Source: Yonhap News Agency