Shares close lower Monday, won falls to monthly low against dollar

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,438.19 points on Monday, down 42.21 points, or 1.70 percent, from the previous trading day. [NEWS1]

Shares closed lower Monday, as strong U.S. jobs data fueled fears of further rate hikes to tame inflation. The won fell sharply to a monthly low against the dollar.

The Kospi fell 42.21 points, or 1.7 percent, to close at 2,438.19 points.

Trading volume was moderate at 554 million shares worth some 7.54 trillion won ($6 billion), with decliners outnumbering gainers 464 to 416.

On Friday (U.S. time), the Dow Jones Industrial Average dropped 0.4 percent, and the tech-heavy Nasdaq Composite sank 1.6 percent.

The Fed raised the benchmark lending rate by 25 basis points Wednesday 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.

Institutions and foreigners sold a combined 817 billion won worth of stocks, offsetting individuals' stock purchases valued at 791 billion won.

The jobs data showed U.S. companies hired twice as many people in January compared to the previous month, raising worries of more rate hikes by the Fed to slow economic activity, analysts said.

"In today's session, foreigners offloaded risky assets to seek safe havens, like the dollar, as the Fed is likely to keep its monetary tightening," Park Hee-cheol, an analyst at Mirae Asset Securities, said.

In Seoul, most large-cap stocks declined.

Samsung Electronics fell 3.5 percent to 61,600 won, and chipmaker SK hynix declined 3.4 percent to 89,100 won, while carmaker Hyundai Motor dropped 1.2 percent to 170,700 won and car battery maker LG Energy Solution shed 1.9 percent to 525,000 won.

Among gainers, full-service carrier Asiana Airlines rose 0.3 percent to 14,970 won, budget carrier Jeju Air jumped 4.3 percent to 16,890 won, and home appliance maker LG Electronics was up 0.8 percent to 101,600 won.

The local currency traded at 1,252.80 won against the dollar, up 23.4 won from the previous session's close.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds rose 17.3 basis points to 3.283 percent, and the return on the benchmark 10-year government bonds climbed 12.6 basis points to 3.522 percent.

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