Seoul: South Korean stocks traded sharply lower late Monday morning on marked losses in chip shares, as strong data on the U.S. economy raised questions about future rate cuts by the Federal Reserve. The benchmark Korea Composite Stock Price Index had lost 24.33 points, or 0.97 percent, to 2,491.45 as of 11:20 a.m.
According to Yonhap News Agency, the index opened lower and extended losses on selling by foreign and institutional investors. Investor sentiment was dampened as a better-than-expected jobs report in the United States dashed expectations for further rate cuts by the Federal Reserve. The Fed has already trimmed its forecast for rate cuts this year to two from the previous four.
Major companies experienced declines as market bellwether Samsung Electronics fell 1.63 percent and chip giant SK hynix dipped 3.29 percent. Carmakers also lost ground with top automaker Hyundai Motor sinking 3.1 percent and its sister affiliate Kia sliding 1.7 percent.
In the materials sector, No. 1 steelmaker POSCO Holdings decreased 1.53 percent, and top chemicals manufacturer LG Chem lost 1.63 percent. However, leading battery maker LG Energy Solution inched up 0.14 percent. Major bio shares traded mixed with Samsung Biologics surging 1.8 percent while Celltrion tumbled 1.19 percent.
The local currency was trading at 1,472.05 won against the U.S. dollar at 11:20 a.m., down 7.05 won from the previous session.