SEOUL: Seoul shares experienced a slight decline on Thursday, extending their downward trend to a fifth consecutive session. This decline is attributed to the political turmoil surrounding the impeachment trial and investigation against President Yoon Suk Yeol, while the South Korean won appreciated against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) fell by 0.55 points, or 0.02 percent, closing at 2,398.94. The trading volume remained low, with 344.7 million shares exchanged, valued at 6.8 trillion won (approximately US$4.63 billion). Nonetheless, the number of gainers surpassed losers, with 451 stocks rising compared to 426 declining.
Institutional and foreign investors combined sold a net 428.8 billion won, whereas individual investors purchased a net 355.7 billion won. The South Korean financial market has been under pressure due to Yoon's brief declaration of martial law on December 3, which resulted in the passing of an impeachment motion against him. The state anti-corruption agency was expected to move forward with a warrant to detain Yoon for questioning, following a Seoul court's approval of the warrant in a criminal case related to insurrection charges.
"Last year was particularly challenging for the domestic stock market due to internal and external uncertainties, and with uncertainties persisting, it will be difficult to expect a quick recovery in investor sentiment," stated Kim Ji-won, an analyst at KB Securities.
Major blue-chip stocks lost ground, with chipmakers and battery stocks leading the overall decline. SK hynix fell by 1.55 percent to 171,200 won, and LG Energy Solution decreased by 0.57 percent to 346,000 won. Steel and chemical stocks also retracted, as POSCO Holdings, a leading steelmaker, dropped 1.38 percent to 250,000 won, and LG Chem fell 3 percent to 242,500 won.
Conversely, financial stocks saw gains, with KB Financial rising 0.60 percent to 83,400 won and Shinhan Financial increasing by 0.21 percent to 47,750 won. Additionally, Samsung Electronics, a market heavyweight, added 0.38 percent to close at 53,400 won.
Defense-related shares experienced robust trading after the government announced plans to support the industry in securing significant overseas deals. Hanwha Aerospace surged 11.33 percent to 363,500 won, and LIG Nex1 soared 15.19 percent to 254,000 won.
The local currency traded at 1,466.60 won against the U.S. dollar at 3:30 p.m., marking an increase of 5.90 won from the previous session. Bond prices, which move inversely to yields, closed significantly higher. The yield on three-year Treasurys decreased by 8.9 basis points to 2.507 percent, while the return on five-year government bonds dropped 8.1 basis points to finish at 2.681 percent.