Tech, chip shares rise Thursday after Fed announces small rate hike

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,468.88 points on Thursday, up 19.08 points, or 0.78 percent, from the previous trading day. [NEWS1]

Korea's tech and chip sectors advanced around 4 percent Thursday, after the Federal Reserve delivered a small rate hike and disinflation was mentioned by the Fed Chair.

Seoul shares closed higher with tech and chip stocks leading Kospi's gains.

Shares of Samsung Electronics were up as much as 3.40 percent on Thursday, closing 2.8 percent up to 63,500 won. Shares in SK hynix jumped as much as 3.8 percent, climbing 2.2 percent to 93,400 won.

Shares in Naver were up as much as 3.89 percent, closing 2.92 percent up to 211,500 won. Shares in Kakao were up as much as 4.82 percent, closing 3.70 percent up to 64,500 won.

The Kospi rose 19.08 points, or 0.78 percent, to close at 2,468.88 points.

Trading volume was moderate at 682.5 million shares worth some 9 trillion won, with gainers outnumbering losers 604 to 264.

The Dow Jones Industrial Average closed 0.02 percent higher at 34,092.96 points, and the tech-heavy Nasdaq Composite advanced 2 percent to 11,816.32.

The Fed raised the benchmark lending rate by 25 basis points Wednesday (U.S. time) as expected, and its Chair Jerome Powell said the U.S. central bank needs "substantially more evidence" to be confident that inflation is on a downward path.

"Local stocks got a boost as the Fed said the U.S. economy is moving toward lower inflation though it plans additional rate hikes," You Myeong-gan, an analyst at Mirae Asset Securities, said.

Foreigners bought a net 554.89 billion won worth of stocks, offsetting institutions and individuals' stock selling valued at 632 billion won.

Among decliners, national flag carrier Korean Air fell 1.4 percent to 24,000 won, the country's sole aircraft manufacturer Korea Aerospace Industries declined 0.5 percent to 48,250 won, and state utility Korea Electric Power shed 0.9 percent to 19,490 won.

The won rose against the dollar.

The local currency closed at 1,220.30 won against the U.S. dollar, down 11 won from the previous session's close.

The Kosdaq gained 13.66 points, or 1.82 percent, to close at 764.62 points.

Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds lost 8.2 basis points to 3.181 percent, and the yield on the benchmark 10-year government bonds lost 8.4 basis points to 3.426 percent.

BY SEO JI-EUN, YONHAP [seo.jieun1@joongang.co.kr]