Kospi ends winning streak due to lowered U.S. credit rating

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Kospi ends winning streak due to lowered U.S. credit rating

Screens in Hana Bank's trading room in central Seoul show the Kospi closing at 2,616.47 points on Wednesday, down 1.90 percent, or 50.60 points, from the previous trading session. [YONHAP]

Screens in Hana Bank's trading room in central Seoul show the Kospi closing at 2,616.47 points on Wednesday, down 1.90 percent, or 50.60 points, from the previous trading session. [YONHAP]

Stocks finished lower Wednesday, ending a four-day winning streak as the downgraded U.S. credit rating discouraged investors. The won fell against the dollar.
 
The benchmark Kospi retreated 1.9 percent, or 50.6 points, to 2,616.47. Trading volume was heavy at 694.5 million shares worth 15.7 trillion won ($12.1 billion), with decliners outnumbering gainers 652 to 230.
 
Foreign investors and institutions sold off shares worth 84.5 billion won and 686.6 billion won respectively, while retail investors bought a total of 772.2 billion won worth of shares.
 
Wall Street finished mixed Tuesday as investors took a breather from a monthslong rally ahead of earnings reports from major companies and U.S. jobs data.
 
The Dow Jones Industrial Average gained 0.2 percent, while the tech-heavy Nasdaq Composite trimmed 0.43 percent and the S&P 500 lost 0.27 percent.
 
Fitch Ratings downgraded the credit rating of the United States to AA+ from AAA, citing "repeated debt limit standoffs and last-minute resolutions."
 
"Investors' appetite went sharply down in Asian stock markets in the aftermath of the downgrade of the U.S. credit rating by Fitch," Mirae Asset Securities analyst Kim Seok-hwan said.
 
Most large-cap stocks fell in Seoul.
 
Samsung Electronics retreated 1.69 percent to 69,900 won, and SK hynix plunged 4.48 percent to 119,500 won.
 
LG Energy Solution dropped 2.33 percent to 544,000 won.
 
Posco Holdings sank 5.8 percent to 585,000 won, and Posco Future M lost 4.52 percent to 486,000 won.
 
Auto shares also ended in negative terrain, with Hyundai Motor dropping 3.46 percent to 192,500 won and Kia losing 3.96 percent to 80,000 won.
 
Among gainers, Amore Pacific shot up 5.56 percent to 119,600 won, and LG Household & Health Care grew 1.81 percent to 449,000 won.
 
The local currency ended at 1,298.5 won against the dollar, up 14.7 won from the previous session's close.
 
Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds gained 3.5 basis points to 3.68 percent, and the yield on the benchmark 10-year government bonds advanced 7.3 basis points to 4.03 percent.
 

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