Seoul stocks inch down as inflation fears return

Finance

Published: 12 Oct. 2021, 17:30

Seoul stocks inch down as inflation fears return

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,916.38 points on Tuesday, down 39.92 points, or 1.35 percent, from the previous trading day. [NEWS1]

Stocks closed lower for a second straight session Tuesday on foreign selling amid concerns over inflation sparked by surging prices of oil and other energy resources. The won fell against the dollar.

The benchmark Kospi fell 39.92 points, or 1.35 percent, to close at 2,916.38 points.

Trading volume was moderate at about 648 million shares worth some 12.5 trillion won ($10.4 billion), with losers outnumbering gainers 572 to 310.

Foreigners sold a net 824 billion won worth of stocks, and institutions offloaded 200 billion won. Retail investors bought 980 billion won, keeping the main index from falling further.

Foreigners and institutions offloaded stocks, as they expect a recent fall in the U.S. jobless data would not be sufficient to slow the U.S. Federal Reserve's timeline for tapering its stimulus, analysts said.

The Kospi declined despite a rate-freeze by the central bank. The Bank of Korea held its policy rate at 0.75 percent in October.

The index slumped the entire session on spiking energy costs, with benchmark oil prices surpassing $80 a barrel on expectations the global power shortage would last longer.

A coal shortage in China also fanned anxiety of less production of industrial metals, such as aluminum.

Most shares closed lower across the board.

Samsung Electronics plunged 3.5 percent to 69,000 won, and Kakao fell 3.4 percent to 113,500 won. Kakao Bank dropped 2.98 percent to 55,300 won.

Chipmaker SK hynix declined 2.66 percent to 91,500 won, and automaker Hyundai Motor shed 0.24 percent to 204,500 won.

Among gainers, LG Chem jumped 4.19 percent to 796,000 won, and refiner SK Innovation climbed 3.43 percent to 256,500 won.

Pharmaceutical firm Samsung Biologics edged up 0.48 percent to 834,000 won.

The Kosdaq lost 12.96 points, or 1.36 percent, to close at 940.15.

The local currency closed at 1,198.8 won against the dollar, up 4.2 won from the previous session's close.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds added 11.7 basis points to 1.818 percent, and the yield on the benchmark 10-year government bond gained 3.5 basis points to 1.61 percent.

BY LEE TAE-HEE, YONHAP [lee.taehee2@joongang.co.kr]