KOSPI Hits 10-Month Low Amid Concerns Over Fed Rate Hike; Won Falls to 3-Week Low

SEOUL - South Korea's benchmark stock index, the KOSPI, plunged 2.71 percent on Thursday to close at its lowest level in 10 months due to growing fears of a potential U.S. Federal Reserve rate hike.

According to a new release by the Yonhap News Agency, the KOSPI shed 64.06 points to close at 2,299.08, the lowest mark since January 6, when it finished at 2,289.97.

The secondary KOSDAQ index also experienced a drop, declining 3.5 percent to 743.85. Trading volume for the KOSPI was moderate with 520 million shares valued at 9 trillion won (approximately US$6.6 billion) changing hands. Decliners on the exchange significantly outnumbered gainers, 833 to 79.

Foreign investors sold off a net 478 billion won worth of local shares, while retail investors and institutions made purchases totaling 320.8 billion won and 110.6 billion won, respectively. This massive selling by foreign investors comes in the context of the S&P 500 tumbling 1.43 percent overnight, while the Nasdaq Composite fell 2.43 percent due to disappointing cloud figures from Google's parent company Alphabet and a rise in U.S. Treasury yields.

Kim Seok-hwan, an analyst at Mirae Asset Securities Co., attributed the fall to "growing global macro uncertainties" and noted that foreign investors had turned net sellers in key sectors such as semiconductors and batteries for the first time in 10 months.

Major companies in Seoul saw significant declines in their share prices. Samsung Electronics dropped 1.91 percent to 66,700 won, and SK hynix lost 5.88 percent to close at 120,000 won. Leading battery manufacturer LG Energy Solution fell 2.44 percent to 399,500 won, while its rival Samsung SDI declined 5.05 percent to 423,000 won amid forecasts of slowing global demand for batteries and electric vehicles in the coming year.

Additional sectors also saw substantial decreases. Steel giant POSCO Holdings decreased 5.39 percent to 421,500 won, and its affiliate POSCO Future M fell 8.94 percent to 249,500 won. The automobile sector was not spared, with Hyundai Motor losing 1.37 percent to 179,500 won and Kia dropping 1.22 percent to 81,000 won. Internet portal Naver declined 3.81 percent to 181,900 won, while Kakao fell 3.34 percent to 37,650 won.

In currency markets, the South Korean won ended the trading session at 1,360.00 won against the U.S. dollar, down 10.3 won from its previous close.

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