Seoul shares slump nearly 2 pct on rate hike woes

SEOUL– Seoul stocks retreated nearly 2 percent Friday amid expectations of further rate hikes in the United States. The Korean won fell against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) retreated 43.04 points, or 1.83 percent, to close at 2,313.69 points.

Trading volume was moderate at about 360 million shares worth some 5.9 trillion won (US$4.6 billion), with losers outnumbering gainers 796 to 98.

Institutions bought a net 251 billion won, while foreigners sold 73 billion won and retail investors offloaded 181 billion won.
Stocks opened lower, tracking overnight falls on Wall Street.

Strong U.S. economic data, including estimate-beating growth and consumption, added to the prospects that the U.S. Federal Reserve may continue to raise interest rates next year in an effort to rein in high inflation.

Overnight, the Dow Jones Industrial Average lost 1.05 percent, and the tech-heavy Nasdaq Composite retreated 2.18 percent.

“The revised-up U.S. GDP fanned rate hike concerns about possibilities of additional rate hikes down the road. Investors seem to have reacted more sensitively than usual to economic projections and data on fundamentals,” Daishin Securities analyst Lee Kyung-min said.

In Seoul, losses among big tech companies led the KOSPI’s fall. Chipmakers fared poorly due to expectations for lower demand for chips in the global market next year.

Market bellwether Samsung Electronics declined 1.69 percent to 58,100 won, No. 2 chipmaker SK hynix dropped 1.77 percent to 77,800 won, and leading automaker Hyundai Motor decreased 0.95 percent to 157,000 won.

Major battery maker LG Energy Solution dipped 3.39 percent to 455,500 won, with chemical giant LG Chem losing 2.56 percent to 61,000 won. Internet portal operator Naver slid 3.52 percent to 178,000 won.

The local currency closed at 1,280.8 won against the U.S. dollar, down 4.6 won from the previous day’s close.

Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys added 5.6 basis points to 3.623 percent, and the return on the benchmark five-year government bond rose 7.6 basis points to 3.567 percent.

Source: Yonhap News Agency

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