Seoul shares down for 3rd day despite eased U.S. inflation

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2491.00 points on Thursday, down 0.22 percent, or 5.51 points, from the previous trading day. [NEWS1]

Seoul shares ended lower to extend their losing streak to a third day Thursday as investors remain watchful on whether the U.S. Federal Reserve will put its policy rate on hold next month following improved U.S. inflation data. The won fell against the dollar.

The Kospi fell 5.51 points, or 0.22 percent, to 2,491.00.

Trading volume was moderate at 635.97 million shares worth 8.82 trillion won ($6.6 billion), with gainers outnumbering decliners 502 to 356.

Institutions and foreigners bought a combined 84.4 billion won worth of stocks, offsetting individuals' stock selling valued at 84 billion won.

Much-anticipated U.S. consumer price data matched market expectations, but investors remain cautious about the Fed's decision in the next rate-decision meeting in June to take a cue in reorganizing their portfolios, analysts said.

Overnight, U.S. inflation data came in at 4.9 percent for April, according to the U.S. Bureau of Labor Statistics. The inflation was the lowest in two years since April 2021 and 0.1 percent point lower on month.

The 10 consecutive interest rate hikes by the U.S. central bank since March 2022 have steered inflation to slow down, which peaked in June at 9.1 percent and eased out over the months.

Market analysts now turn their eyes to the personal consumption expenditure index, an inflation gauge closely watched by the Fed, scheduled for update on May 26 and the producer price index due later Thursday.

In Seoul, tech and energy stocks were lead decliners.

Market bellwether Samsung Electronics fell 0.6 percent to 64,200 won, and chipmaker SK hynix declined 0.7 percent to 86,300 won

Refiner SK Innovation dropped 1.2 percent to 178,200 won, and car battery maker LG Energy Solution shed 2.3 percent to 553,000 won.

Among gainers, national flag carrier Korean Air rose 0.7 percent to 22,800 won, and the country's sole aircraft manufacturer Korea Aerospace Industries climbed 2.9 percent to 52,500 won.

The local currency ended at 1,326.30 won against the dollar, up 1.5 won from the previous session's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds lost 5.6 basis points to 3.22 percent, and the yield on the benchmark 10-year government bonds shed 7.6 basis points to 3.443 percent.

BY SOHN DONG-JOO, YONHAP [sohn.dongjoo@joongang.co.kr]