Kospi jumps up ahead of U.S. Fed decisionLocal stocks rose sharply Monday as investors’ appetite increased ahead of the U.S. Federal Reserve Bank’s monetary policy decision this week. The won rose against the dollar, snapping its five-day losing streak.
Foreigners and institutions scooped up a net 2.2 billion won and 278.6 billion won, respectively, to offset net selling worth 282.8 billion won by retail investors.
“Investors bought mostly large-cap stocks as the Fed is expected to keep the benchmark interest rate at the current levels of 2.25 percent to 2.50 percent due to low inflation,” said Suh Sang-young, an analyst at Kiwoom Securities.
On Tuesday, the Federal Open Market Committee will begin its two-day meeting to decide whether to maintain the current rate band, with many expecting a freeze in the rates.
Most large-cap stocks advanced across the board, with tech, auto and steel stocks leading gains.
Samsung Electronics jumped 2.90 percent to 46,150 won, and No. 2 chipmaker SK Hynix climbed 1.78 percent to 80,000 won.
The country’s leading steelmaker Posco was up 0.98 percent to 257,000 won.
Top carmaker Hyundai Motor gained 2.58 percent to 139,000 won, and its auto parts maker, Hyundai Mobis, climbed 3.76 percent to 234,500 won. Hyundai’s sister company, Kia Motors, jumped 5.36 percent to 45,250 won.
Among decliners, national flag carrier Korean Air fell 0.5 percent to 33,150 won, and No. 2 carrier Asiana Airlines plunged 5.1 percent to 6,210 won. Top cosmetic firm Amorepacific lost 2.43 percent to 221,000 won.
The secondary Kosdaq rose 9.60 points, or 1.30 percent, to close at 750.60. The index ended higher as foreigners and institutions mass purchased local stocks after seeing Nasdaq’s biotech shares gain 0.5 percent over the weekend.
The won traded at 1,158.50 won against the dollar, down 2.5 won from the previous day’s close, marking the first rise in six days. The local currency has been losing ground to the dollar in the past few days due to weak economic data.
Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds lost 0.8 basis points to 1.712 percent, and the return on 10-year bonds went down 1.2 basis points to 1.864 percent.
BY KO JUN-TAE, YONHAP [firstname.lastname@example.org]