Stocks hit 17-month low as investors fret about inflation

Home > Business > Finance

Stocks hit 17-month low as investors fret about inflation

Published: 10 May. 2022, 17:41

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,596.56 points on Tuesday, down 14.25 points, or 0.55 percent, from the previous trading day. [YONHAP]

Stocks fell for the sixth consecutive day Tuesday to hit a 17-month low, as investors fretted about high inflation and a global economic slowdown amid the ongoing crisis in Ukraine and China's lockdown of major cities over Covid-19. The local currency logged its largest decline against the dollar in more than two years.

The Kospi lost 14.25 points, or 0.55 percent, to close at 2,596.56, extending losses to the sixth session in a row. It is the first time since November 30 that the index fell below 2,600.

Trading volume was moderate at 826.79 million shares worth 10.69 trillion won ($8.38 billion), with decliners outnumbering gainers 614 to 262.

Foreign investors sold a net 331.4 billion won worth of shares, while retail investors and institutions bought a net 285.6 billion won and 6.9 billion won worth of shares, respectively.

"There have been fears that the U.S. rate hikes to curb inflation would hamper global economic growth," Cape Investment & Securities analyst Na Jeong-hwan said.

"Weak China export data and the prolonged conflicts over Ukraine have also increased market volatility," Na added.

In April, China's export growth weakened by the most in about two years due mainly to the country's strict virus curbs. Shanghai has remained locked down since late March, and Beijing has tightened travel and business restrictions over the spread of Covid-19.

In Seoul, Samsung Electronics fell 0.61 percent to 65,700 won, and LG Energy Solution shed 0.13 percent to 393,500 won.

SK hynix rose 2.33 percent to 110,000 won, and Kia jumped 1.82 percent to 84,100 won.

The local currency ended at 1,276.4 won against the dollar, up 2.4 won from the previous session's close. It marked the highest since March 19, 2020, when the won depreciated to 1,285.70 won.

The Kosdaq declined 4.70 points, or 0.55 percent, to close at 856.14 points.

Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds fell 1.4 basis points to 3.046 percent, and the yield on the benchmark 10-year government bond lost 9.9 basis points to 3.03 percent.

BY CHO JUNG-WOO, YONHAP [[email protected]]