Kospi maintains upward trend on possible delay to Fed rate cut

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,753.16 points on Tuesday, up 0.19 percent, or 5.30 points, from the previous trading session. [YONHAP]

Stocks closed higher Tuesday to extend their winning streak to a third day on strong gains in tech amid speculation that strong U.S. data may prod the Federal Reserve to push back its rate-cut timetable, while won tumbled to the lowest in over five months against the dollar.

The Kospi rose 5.30 points, or 0.19 percent, to close at 2,753.16.

Trade volume was heavy at 618.07 million shares worth 12.9 trillion won (US$9.5 billion), with decliners outpacing gainers 976 to 220.

Foreigners bought a net 1 trillion won worth of stocks, offsetting institutions and individuals' stock selling valued at a combined 976 billion won.

The market got a boost from robust manufacturing activities in the United States and China last month, analysts said.

The Institute for Supply Management's manufacturing purchasing managers' index, released overnight, stayed at 50.3 last month, the highest since September 2022 despite a prolonged tightening phase by the Fed.

China Manufacturing Purchasing Managers Index (PMI) expanded for the first time in six months in March, with the index coming in at 50.8, up from 49.1 a month earlier.

"Tech shares are likely to continue to support the main index ahead of the release of fourth-quarter earnings results (coming this month) due to strong demand for semiconductors and other technology devices," No Dong-kil, an analyst at Shinhan Securities, said.

Meanwhile, the Fed has said it expects three rate cuts this year, but its easing policy may drag on if inflation remains elevated and the economy continues to grow.

In Seoul, tech stocks were lead gainers.

Samsung Electronics rose 3.66 percent to 85,000 won, while SK hynix gained 0.43 percent to 186,300 won.

Amorepacific climbed 3.95 percent to 134,200 won.

Hanwha Ocean was up 1.07 percent to 28,250 won.

Among decliners, Hyundai Motor fell 3.30 percent to 220,000 won and Kia lost 3.68 percent to 104,700 won.

Korean Air declined 1.81 percent to 21,650 won and Korea Electric Power Corporation shed 2.49 percent to 21,550 won.

LG Energy Solution was down 0.63 percent to 393,000 won, while Posco Future M slid 3.04 percent to 287,000 won.

The local currency closed at 1,352.10 won against the greenback, up 2.7 won from the previous session's close.

The Kosdaq lost 20.86 points, or 2.29 percent, to close at 891.59.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds gained 4.6 basis points to 3.333 percent and the return on the benchmark U.S. 10-year government bonds rose 11.50 basis points to 4.316 percent.

BY KIM JI-YE, YONHAP [kim.jiye@joongang.co.kr]