SEOUL– Seoul shares finished lower Monday amid investors’ jitters over possibly aggressive rate hikes in major economies. The South Korean won slightly rose against the U.S. dollar.
The Korea Composite Stock Price Index (KOSPI) fell 7.66 points, or 0.29 percent, to close at 2,596.58.
Trading volume was moderate at 767.29 million shares worth 8.38 trillion won (US$6.5 billion), with gainers outpacing decliners 542 to 315.
Foreigners and institutions offloaded a net combined 119 billion won worth of stocks. Individuals bought a net 64.8 billion won stocks.
Seoul stocks opened higher Monday, tracking Wall Street gains boosted by Federal Reserve Chair Jerome Powell’s remarks that the U.S. central bank was not “actively considering” a more aggressive 75-basis-point hike.
But the market soon pared earlier gains following Bank of Korea Gov. Rhee Chang-yong’s comments that he is not eliminating the option of a 50-basis-point rate hike, as uncertainty about already-elevated inflation remains high.
“It is not the stage where we can completely rule out the possibility of a big step hike,” Rhee said, adding”Whether we could consider (a 0.5-percentage point increase) will rest on how much inflation rises going forward.”
Last month, the BOK raised the policy rate by a quarter-percentage point to 1.5 percent as part of efforts to tamp down rising inflation and curb household debt.
“The KOSPI is facing downward pressures as concerns are growing over the Chinese economy’s potential hard landing following April’s economic data,” analyst Park Sang-hyun of Hi Investment & Securities said.
“BOK Governor’s comments on a potential big step also weighed on the market,” he added.
Most large-cap stocks finished mixed.
Market bellwether Samsung Electronics Co. shed 0.3 percent to 66,300 won, No. 2 chipmaker SK hynix Inc. lost 1.78 percent to 110,500 won. Top carmaker Hyundai Motor Co. declined 1.34 percent to 184,000 won, and national flag carrier Korean Air Lines Co. lost 0.86 percent to 28,900 won.
Kakao, the operator of mobile messenger app Kakao Talk, gained 0.61 percent to 82,300 won, and KB Financial added 0.69 percent to 58,700 won.
The local currency ended at 1,284.10 won against the U.S. dollar, up 0.1 won from the previous session’s close.
Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys rose 13.5 basis points to 3.046 percent, and the return on the benchmark five-year government bond jumped 10.3 basis points to 3.225 percent.
Source: Yonhap News Agency