Kospi rises 3.3 percent, rebounding from recession fears

Finance

Kospi rises 3.3 percent, rebounding from recession fears

Published: 06 Aug. 2024, 18:47

A screen in Hana Bank's trading room in central Seoul shows Kospi closing at 2,522.15 points on Tuesday, up 3.30 percent, or 80.60 points, from the previous trading session. The Kosdaq rose 6.02 percent, or 41.59 points, to 732.87. [NEWS1]

Stocks rose more than 3 percent Tuesday, rebounding from the previous day's worst market sell-off, sparked by fears over a U.S. recession and the sluggish performance of big tech firms. The local currency slightly fell in value against the greenback.

The benchmark Kospi gained 80.6 points, or 3.3 percent, to close at 2,522.15.

It marked a turnaround from a whopping 8.77 percent crash Monday as investor sentiment was undermined by fears that the U.S. economy was losing steam and recent disappointing forecasts from big U.S. technology companies.

Trade volume was heavy at 530.9 million shares worth 15.2 trillion won ($11 billion), with winners beating losers 851 to 73.

Individual investors led the upturn, scooping up a net 451.8 billion won, while foreigners dumped a net 193.1 billion won and institutions sold a net 320.9 billion won.

Earlier in the day, data showed that the U.S. services sector activity rebounded from a four-year low in July, helping relieve fears of a recession in the world's largest economy.

"Kospi, which suffered its worst daily loss of 234 points in the previous session, saw an inflow of investment on eased recession woes," said Lee Jae-won, an analyst at Shinhan Securities.

Most shares gained ground across the board.

Samsung Electronics added 1.54 percent to 72,500 won, and SK hynix rose 4.87 percent to 163,700 won.

Hyundai Motor jumped 4.91 percent to 235,000 won, and its sister Kia went up 6.65 percent to 102,700 won.

Shipbuilders were among the biggest winners as HD Korea Shipbuilding & Offshore Engineering surged 10.13 percent to 190,300 won, and Hanwha Ocean jumped 8.72 percent to 29,300 won.

Banking group KB Financial Group rose 3.52 percent to 79,500 won, and game publisher NCsoft vaulted 7.04 percent to 171,700 won.

The local currency was trading at 1,375.6 won against the dollar as of 3:30 p.m., up 0.8 won from the previous session.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds rose 13.6 basis points to 2.933 percent, and the return on the benchmark U.S. 10-year bonds rose 0.60 basis points to 3.795 percent.

BY YOON SEUNG-JIN, YONHAP [yoon.seugjin@joongang.co.kr]