Seoul:South Korean shares fell on Wednesday as increasing U.S. Treasury yields raised concerns about higher borrowing costs, affecting investor sentiment. Additionally, the Korean won weakened against the U.S. dollar.
According to Yonhap News Agency, the Korea Composite Stock Price Index (KOSPI) dropped 32.77 points, or 0.48 percent, to close at 6,838.04, marking its third straight session of losses. Despite a decline in oil prices, U.S. stocks ended slightly lower overnight due to persistently high Treasury yields keeping investors cautious.
Global bond yields have climbed to multi-year highs as concerns rise that elevated energy prices could maintain inflationary pressures and lead to further interest rate hikes. Specifically, the 30-year U.S. Treasury yield surpassed 5.6 percent, the highest level in 24 years, while the benchmark 10-year yield stayed above 5.2 percent, the highest since 2007.
On the trading floor, volume was light with 264.24 million shares worth 18.81 trillion won (approximately US$13.89 billion) changing hands. Decliners outnumbered advancers 511 to 351. Foreign investors and institutions sold a net 2.05 trillion won and 767.97 billion won, respectively, while individual investors purchased a net 1.17 trillion won.
Han Ji-young, an analyst at Kiwoom Securities, noted that while the market largely anticipated further increases in the 10-year U.S. Treasury yield, the faster-than-expected rise has continued to pressure stocks.
Among market heavyweights, Samsung Electronics fell 1.47 percent to 268,500 won. In contrast, SK hynix saw a slight rise, edging up 0.62 percent to 1.78 million won. Financial shares were also down, with KB Financial Group decreasing 2.71 percent to 168,800 won and Shinhan Financial Group dropping 3.98 percent to 106,100 won.
The Korean won was quoted at 1,352.8 won against the U.S. dollar as of 3:30 p.m., an increase of 1.2 won from the previous session's close.