Kospi’s gains vanquish two-day losing streak

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Kospi’s gains vanquish two-day losing streak

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Korean stocks closed higher Thursday to snap a two-day losing streak as foreign investors scooped up large-cap tech shares after a dovish statement by the U.S. Federal Reserve, analysts said. The won gained ground against the dollar.

The benchmark Kospi added 7.78 points, or 0.36 percent, to reach 2,184.88. Trade volume was moderate at 337 million shares worth 6.15 trillion won ($5.45 billion), with decliners far outnumbering gainers 623 to 236.

Foreigners bought a net 486.7 billion won worth of shares on the main exchange, while individual and institutional investors offloading 326.0 billion won and 152.1 billion won worth of shares more than they bought, respectively.

After opening higher, the Seoul index extended gains on the back of strong buying by foreigners targeting major chip giants.

At an overnight monetary session, the U.S. central bank ruled out interest rate increases this year, citing a gloomier outlook on the U.S. economy. It will also stop scaling back its bond portfolio in September.

“The U.S. Federal Reserve’s dovish stance was reaffirmed and its decision to abandon projections for any interest rate hikes have pushed up growing appetites for risky assets,” said Lee Young-gon, a researcher from Hana Financial Investment. “Micron’s announcement also positively affected investor sentiment of local IT companies.”

Shares of chip giants surged as the chip industry outlook improved following an improved earnings announcement by U.S. chipmaker Micron Technology.

Top cap Samsung Electronics ended at 45,850 won, up 4.09 percent from the previous session’s close, to continue a three-day winning streak. No. 2 chipmaker SK Hynix surged 7.66 percent to 75,900 won.

Samsung SDI advanced 4.81 percent to 218,000 won and LG Chem increased 5.23 percent to end at 382,000 won on news that the two companies could advance into the Chinese EV battery market.

The Kosdaq lost 6.24 point, or 0.83 percent, to finish the session at 743.52. Shares of YG Entertainment, which represents K-pop band Big Bang, fell 1.67 percent to end at 35,400 won on news of a tax probe.

The won closed at 1,127.7 won against dollar, down 2.7 won from the previous session.

Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds lost 2.0 basis points to reach 1.793 percent, and the return on 10-year bonds lost 4.9 basis points to finish at 1.932 percent.


BY KO JUN-TAE, YONHAP [ko.juntae@joongang.co.kr]
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