Stocks rebound Wednesday, on hopes Fed may slow pace of interest rate hikes

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Stocks rebound Wednesday, on hopes Fed may slow pace of interest rate hikes

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2.249.56 points on Wednesday, up 14.49 points, or 0.65 percent, from the previous trading day. [YONHAP]

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2.249.56 points on Wednesday, up 14.49 points, or 0.65 percent, from the previous trading day. [YONHAP]

 
Stocks rebounded Wednesday, after signs of contraction in the U.S. economy rekindled hopes that the U.S. Federal Reserve may start slowing the pace of interest rate hikes. The local currency gained against the dollar.
 
The Kospi closed up 14.49 points, or 0.65 percent, to 2,249.56. Trading volume was moderate at 553.3 million shares worth 7.38 trillion won ($5.17 billion) with declining issues outnumbering advancing ones 593 to 269.
 
"Better-than-expected third-quarter earnings and expectations for a less aggressive Fed monetary tightening are helping investors recover appetite for risky assets," said Han Ji-young, an analyst at Kiwoom Securities.
 
"Weaker U.S. economic data suggest the impact of the Fed's monetary tightening is kicking in. Given these circumstances, it's fair to say that the possibility is open for the Fed to slow down on the rate increases," Han said.
 
Data showed U.S. October consumer confidence fell from a month earlier, with home price growth also slowing in August from the previous month.
 
The softer data renewed speculation that the Fed could start scaling down the rate hikes after its November monetary policy meeting set for Nov. 1-2.
 
Top-listed tech companies drove up the main index.
 
Samsung Electronics soared 2.95 percent to 59,400 won and LG Energy Solution jumped 3.52 percent to 529,000 won after reporting a turnaround in the third-quarter earnings.
 
Samsung SDI climbed 3.36 percent to 677,000 won on the back of record-high profit and revenue in the third quarter. 
 
Automakers, however, finished in the red. Hyundai Motor fell 1.23 percent to 160,500 won, with Kia losing 1.21 percent to 65,500 won.
 
Naver slumped 3.63 percent to 159,500 won and Kakao also sank 2.25 percent to 47,700 won.
 
The local currency ended at 1,426.60 won against the U.S. dollar, down 6.5 won from Tuesday's close.
 
The Kosdaq fell 5.68 points, or 0.82 percent, to close at 683.17 points.
 
Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds fell 4.9 basis points to 4.189 percent, and the yield on 10-year government bonds declined 13.0 basis points to 4.255 percent.
 
 
 

BY LIM JEONG-WON, YONHAP [lim.jeongwon@joongang.co.kr]
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