An electronic chart showing Korea’s Composite Stock Price Index (Kospi) in a trading room at Hana Bank’s headquarters in Seoul on Thursday. (Yonhap)
South Korean stocks rebounded slightly on Thursday, ending their seven-day losing streak, as uncertainty over the future course of the U.S. Federal Reserve eased somewhat after its biggest rate hike. in almost three decades. The local currency appreciated against the US dollar.
The Korea Composite Stock Price Index (KOSPI) added 4.03 points, or 0.16%, to close at 2,451.41, after erasing most of its earlier gains. The index hit an intraday high of 2,500.36.
Trading volume was moderate at 567.50 million shares worth 9.34 trillion won ($7.25 billion), with declines outpacing gains 435 to 426.
Foreign investors bought 146.5 billion won net worth of stocks, while individuals and institutions sold 156.94 billion won net and 18.52 billion won worth of stocks, respectively.
The index got off to a strong start, tracking Wall Street’s gains after the Fed raised the key rate by 0.75 percentage points, the biggest increase since 1994.
Investors welcomed the move because it met market expectations and, analysts said, signaled the Fed’s determination to fight inflation.
But many of the early gains were pared here as concerns returned to runaway inflation and the potential impacts of the Fed’s aggressive monetary tightening on global economic growth.
“Uncertainties over the Fed’s rate hike eased somewhat and the Korean won rose against the US dollar, which helped push the index higher,” said Kiwoom analyst Han Ji-young. Securities Co.
“But it would take time to see a meaningful recovery, and the volatility is likely to continue for some time.”
Finance Minister Choo Kyung-ho raised fears about rising market volatility and a global economic slowdown amid accelerating monetary tightening, promising responses “with a sense of urgency”.
In Seoul, large-cap tech and chemical stocks gained ground to lead the rally.
Market leader Samsung Electronics rose 0.33% to 60,900 won, and top battery maker LG Energy Solution jumped 1.67% to 427,000 won.
Chemicals giant LG Chem jumped 4.1% to 584,000 won and Samsung SDI jumped 3.98% to 549,000 won.
Samsung Biologics also climbed 2.15% to 807,000 won, and major steelmaker POSCO rose 2.29% to 267,500 won.
But No. 2 chipmaker SK hynix fell 0.51% to 97,400 won.
Automakers also lost ground on profit taking, with Hyundai Motor down 0.57% to 173,000 won and its smaller subsidiary Kia down 1.15% to 77,200 won.
Internet portal giant Naver fell 1.84% to 240,000 won and Kakao slipped 0.55% to 72,300 won.
The local currency finished at 1,285.6 won against the US dollar, up 4.9 won from the previous session’s close.