Kospi slides with disappointment in Q2
The U.S. Fed froze the federal funds rate at 0 to 0.25 percent, where it has been since Dec. 2008.But disappointment over Korean companies’ second quarter sales reports and increased certainty that the Fed will raise the key rate by December teed up the Kospi for its worst monthly slide of 2015.
The Seoul main bourse fell 0.91 percent, or 18.59 points, to 2,019.03.
Several blue chip shares dropped in a massive selling spree. Samsung Electronics dropped 3.8 percent to 1,215,000 won ($1,049) while LG Electronics plummeted by 6.72 percent to 40,850 won. LG Display retreated 2.16 percent to 22,700 won.
Chipmaker SK Hynix plummeted by 6.76 percent to 34,500 won. Leading cosmetics maker AmorePacific lost 4.13 percent to 406,000 won while top portal site operator Naver plunged 13.95 percent to end at 518,000 won on its second quarter sales report, which fell short of expectations.
The shares of insurers and carmakers advanced. Samsung Life Insurance gained 4.98 percent to 105,500 won and Hyundai Motor added 2.74 percent to 150,000 won.
The pharmaceutical industry plunged. Hanmi Pharmaceuticals dived 11.46 percent to 394,000 won on the second quarter earnings report that fell short of investors’ expectations. Drug maker Yuhan Corporation dropped 4.57 percent to 271,500 won despite positive notes on its current sales performance from several securities companies.
The won fell 0.8 percent, the most since July 23, to close at 1,168.22 a dollar in Seoul, according to data compiled by Bloomberg.
“Downward pressure on the won will increase after the Fed meeting,” said Kim Moon-il, an analyst with Eugene Investment & Securities in Seoul, who had predicted the currency’s fall to 1,168 on Thursday.
Korea’s Deputy Finance Minister Choi Hee-nam convened a meeting Thursday morning to discuss the outcome of the Fed’s meeting Wednesday and the potential impact on the economy, which slowed for the fifth straight quarter.
The 10-year government bonds fell, with the yield rising two basis points to 2.39 percent, Korea Exchange prices showed. The three-year yield also climbed two basis points to 1.74 percent.
BY KIM HYUN-MIN, BLOOMBERG [kim.hyunmin@joongang.co.kr]
with the Korea JoongAng Daily
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