Kospi drops 1.26% as hopes plunge for Fed rate cut

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,721.81 points on Thursday, down 0.06 percent, or 1.65 points, from the previous trading session. [NEWS1]

Stocks opened sharply lower Friday, tracking overnight losses on Wall Street amid lowering hopes for the U.S. Federal Reserve's early rate cuts.

The Kospi shed 34.27 points, or 1.26 percent, to 2,687.54 in the first 15 minutes of trading.

The S&P 500 fell 0.7 percent, the Dow Jones Industrial Average slid 1.5 percent, and the Nasdaq composite went down 0.4 percent as hotter-than-expected economic reports raised speculations the Fed could keep its rate high for longer.

A series of economic reports showed Thursday (local time) that the U.S. price pressure increased and the labor market was still strong.

In Seoul, most of the big-cap shares lost ground.

Samsung Electronics plunged 2.81 percent.

LG Energy Solution dropped 1.1 percent, and its Samsung SDI and Posco Future M lost 1.73 percent and 1.91 percent, respectively.

Hyundai was flat, but Hyundai Mobis, slid 2.2 percent.

Posco Holdings fell 1.55 percent, and chemical producer LG Chem lost 1.78 percent.

IT and insurance shares were also weak.

SK hynix was one of the few gainers, jumping 0.75 percent on the back of U.S. chipmaker Nvidia's continued rally.

The local currency was trading at 1,371.40 won against the dollar, up 9.0 won from the previous session's close.

BY CHOI HAE-JIN, YONHAP [choi.haejin@joongang.co.kr]