Korean shares drop again as Fed projects continued high interest rates

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Korean shares drop again as Fed projects continued high interest rates

Published: 04 Jan. 2024, 16:41

KIM JU-YEON
kim.juyeon2@joongang.co.kr

Screens in Hana Bank's trading room in central Seoul show the Kospi closing at 2,587.02 points on Thursday, down 0.78 percent, or 20.29 points, from the previous trading session. [NEWS1]

Shares dropped for a second consecutive day Thursday after the latest U.S. Federal Reserve minutes suggested interest rates will remain high for some time. The won fell in value against the dollar.

The benchmark Kospi fell 20.29 points, or 0.78 percent, to close at 2,587.02.

The Kosdaq dropped 866.25 points, or 0.61 percent, to close at 866.25.

Trade volume was moderate at 761.45 million shares worth 8.84 trillion won ($6.8 billion), with losers outpacing winners 614 to 277.

Institutions sold a net 800 billion won worth of stocks, outpacing foreigners' and individuals' stock purchases valued at 785 billion won.

Overnight, the Dow Jones Industrial Average fell 0.8 percent to 37,430.19, and the tech-heavy Nasdaq declined 1.2 percent to 14,592.21.

The Fed's December meeting minutes suggest policymakers stood for higher rates for some time. Rate cuts will likely happen later this year, analysts said.

In Seoul, large-cap stocks were mixed across the board.

Samsung Electronics fell 0.5 percent to 76,600 won, and chipmaker SK hynix declined 0.3 percent to 136,400 won.

Carmaker Hyundai Motor dropped 1.96 percent to 190,000 won, while Kia fell 0.96 percent to 92,900 won.

Celltrion slipped down 5.83 percent to 218,000 won, and Samsung Biologics dropped 2.16 percent to 770,000 won.

State utility Korea Electric Power Corporation shed 2.3 percent to 18,810 won.

Posco Holdings fell 0.63 percent to 469,500 won.

Among gainers, shipbuilder HD Hyundai Heavy Industries rose 2.6 percent to 63,500 won, and shipping firm HMM climbed 2.9 percent to 20,500 won.

Naver gained 0.45 percent to 223,000 won, and Kakao also rose 1.06 percent to 57,200 won.

Car battery maker LG Energy Solution was up 0.7 percent to 419,000 won.

The local currency traded at 1,310.00 won against the dollar, up 5.20 won from the previous session's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds fell 5.4 points to 3.224 percent, and the return on benchmark U.S. 10-year government bonds dropped 1.6 points to 3.918 percent.

BY KIM JU-YEON, YONHAP [kim.juyeon2@joongang.co.kr]