Kospi remains nearly flat on eve of U.S. rate decision

Finance

Kospi remains nearly flat on eve of U.S. rate decision

Published: 20 Sep. 2023, 17:48

Screens in Hana Bank's trading room in central Seoul show the stock and foreign exchange markets open on Wednesday. The Kospi closed at 2,559.74 points, up 0.02 percent, or 0.53 points, from the previous trading session. [AP/YONHAP]

Stocks closed almost unchanged Wednesday as investors await the U.S. rate decision announcement set for release overnight. The won fell against the dollar.

The benchmark Kospi added 0.53 points, or 0.02 percent, to finish at 2,559.74.

Trading volume was slightly thin at 407.3 million shares worth 7.4 trillion won ($5.6 billion), with decliners outpacing winners 517 to 353.

Stocks open unchanged before Fed's rate decision

Individuals and institutions purchased 88.9 billion won and 50.2 billion won worth of local shares, respectively, while offshore investors sold off a net 166.6 billion won.

All three U.S. stock indexes closed lower Tuesday on the eve of the Federal Reserve's interest rate announcement, which is expected to keep rates on hold.

But the market expects the U.S. central bank to deliver one more rate hike this year as higher energy costs will likely heat up inflation and curb economic growth.

"A climb in U.S. bond yields weighed down on the stock markets a day ahead of the September Federal Open Market Committee meeting," Daishin Securities analyst Lee Kyoung-min said.

The yield on 10-year U.S. government bonds reached 4.366 percent to hit its highest point since 2007.

In Seoul, large-cap stocks traded mixed.

Samsung Electronics dropped 0.3 percent to 69,600 won and SK hynix lost 1 percent to 118,000 won.

Samsung Biologics retreated 1.4 percent to 719,000 won and Celltrion fell 0.2 percent to 145,300 won.

IT firms also finished lower, with Naver sinking 0.9 percent to 217,500 won and Kakao slipping 1.6 percent to 47,100 won.

Among gainers, LG Energy Solution rose 0.6 percent to 499,500 won and Samsung SDI climbed 0.9 percent to 563,000 won.

Posco Holdings added 0.2 percent to 594,000 won and Posco Future M shot up 3.7 percent to 411,000 won.

Hyundai Motor jumped 2.6 percent to 194,900 won and Kia advanced 2.5 percent to 81,400 won.

The local currency ended at 1,330.1 won against the dollar, up 1.6 won from Tuesday's close.

Bond prices, which move inversely to yields, closed mixed. The yield on three-year government bonds remained flat at 3.9 percent, and the yield on the benchmark 10-year U.S. government bonds rose 5.5 basis points to 4.4 percent.

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