Kospi closes up as investors welcome U.S. rate cut

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Kospi closes up as investors welcome U.S. rate cut

Published: 19 Sep. 2024, 18:02

CHO YONG-JUN
cho.yongjun1@joongang.co.kr

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,580.80 points on Thursday. [YONHAP]

Shares ended higher Thursday as investors cheered the U.S. Federal Reserve's first rate cut in more than four years. The won also fell against the dollar.

The benchmark Kospi rose 0.21 percent, or 5.39 points, to close at 2,580.80.

Trading volume was moderate at 378.78 million shares worth 12.6 trillion won ($9.5 billion), with gainers exceeding decliners 497 to 371.

The Fed cut its overnight lending rate to 4.75 percent to 5 percent as inflation eased from two years ago. It also pledged additional rate cuts, which boosted investor sentiment.

"But at the same time, the Fed's big cut has raised concerns over a possible economic recession, with U.S. stocks closing in the red overnight," said Cho Hyun-ji, an analyst with DB Financial Investment.

Foreigners sold a net 1.17 trillion won worth of stocks, exceeding institutions and individuals' stock purchases valued at 1.14 trillion won.

In Seoul, tech stocks were the lead decliners.

Samsung Electronics fell 2 percent to 63,100 won and SK hynix plunged 6.1 percent to 152,800 won.

LG Electronics, however, climbed 4.89 percent to 109,500 won.

SK hynix plunged after Morgan Stanley cut its rating on the chipmaker to underweight from overweight due to its weakening pricing power.

Battery maker LG Energy Solution was down 2 percent to 391,500 won, while Samsung SDI rose 1.92 percent to 372,000 won.

Among gainers, Hyundai Motor Co. rose 3.8 percent to 246,000 won, Korean Air climbed 0.9 percent to 22,600 won, and SK Innovation was up 1.8 percent to 112,700 won.

The local currency traded at 1,329 won against the dollar at 3:30 p.m., down 0.5 won from the previous session. The Kosdaq gained 6.31 points, or 0.86 percent, to close at 739.51.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds gained 2.8 basis points to 2.850 percent, and the return on the benchmark U.S. 10-year government bond rose 4.7 basis points to 3.702 percent.

BY CHO YONG-JUN, YONHAP [cho.yongjun1@joongang.co.kr]