Shares end higher Wednesday after Fed chair says disinflation has begun

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,483.64 points on Wednesday, up 31.93 points, or 1.30 percent, from the previous trading day. [NEWS1]

Shares ended higher Wednesday on foreign buying after Federal Reserve Chair Jerome Powell said that inflation has begun to fall. The Korean won fell against the U.S. dollar.

The Kospi rose 31.93 points, or 1.3 percent, to 2,483.64. Trading volume was moderate at 406.98 million shares worth 7.9 trillion won ($6.3 billion), with gainers outpacing decliners 591 to 282.

Overnight, the Dow Jones Industrial Average rose 0.8 percent to 34,156.69 and the tech-heavy Nasdaq Composite climbed 1.9 percent to 12,113.79.

At the Economic Club of Washington on Tuesday (U.S. time), Powell said disinflation has begun, though further rate hikes will likely be needed to combat inflation if the job market remains strong.

The Fed raised rates by 25 basis points last week to a band of 4.5 percent to 4.75 percent.

Institutions and foreigners bought a combined 582 billion won worth of stocks, offsetting individuals' selling valued at 563 billion won.

Foreigners turned net buyers to scoop up tech stocks after selling local stocks in the past two sessions.

In Seoul, most large-cap stocks advanced.

Samsung Electronics rose 1.9 percent to 63,100 won and chipmaker SK hynix jumped 5.5 percent to 107,600 won.

Internet portal Naver was up 5.0 percent to 230,500 won, and Kakao was up 1.6 percent to 69,100 won.

Carmaker Hyundai Motor climbed 1.3 percent to 172,700 won, and state utility Korea Electric Power gained 1.3 percent to 19,330 won.

Among decliners, budget carrier Jin Air fell 1.6 percent to 17,550 won, full-service carrier Asiana Airlines lost 0.07 percent to 14,850 won, and chemical firm LG Chem shed 1.3 percent to 672,000 won.

The local currency ended at 1,260.10 won against the dollar, up 4.8 won from the previous session's close.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds rose 0.7 basis points to 3.343 percent, and the return on the benchmark 10-year government bonds climbed 3.3 basis points to 3.675 percent.

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