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Seoul: Shares fall on Fed's policy outlook, won lower
[SEOUL] South Korean shares fell on Thursday in response to the Federal Reserve's slightly more hawkish policy tone after the US central bank put an end to its easy money programme, as expected.
The Korea Composite Stock Price Index (KOPS) was down 0.79 per cent at 1,945.58 points as of 0203 GMT.
"The market was unnerved by the rather hawkish undertones in the Fed's statement, but looking forward, liquidity is still plentiful in the market and the ECB is expected to pick up the slack as it kicks off its own stimulus programme," said Kim Yong-gu, an analyst at Samsung Securities.
While the Fed maintained its pledge of keeping short-term interest rates near zero for a "considerable time" at the end of its two-day policy meeting, it dropped the characterization of the US labour market slack as "significant" in a show of confidence in the US economy.
Musings on the Fed's rates outlook and a few downbeat earnings reports locally eclipsed a rise in shares of bellwether Samsung Electronics on hopes for a turnaround in business in the fourth quarter.
Shares in LG Innotek plummetted more than 13 per cent, as several brokerages predicted a rough patch for the LED maker in the fourth quarter, citing severe price competition in the low-mid power LED market.
Chemical firm Hyosung Corp slipped over 7 per cent after reporting an 18.6 per cent drop in its operating profit for the July-September period.
Naver Corp shares fell 4.1 per cent after its third-quarter earnings fell slightly short of expectations despite an 88 per cent rise in operating profit compared to the year before.
Samsung Electronics shares bucked the trend, climbing 3.3 per cent on expectations of a turnaround in fourth quarter earnings.
The South Korean won fell on Thursday as the dollar basked in the afterglow of the Fed's optimistic tone on the US economy.
The local currency was quoted at 1,054.2 to the dollar as of 0203 GMT, compared to Wednesday's closing rate of 1,047.3.
December futures on three-year treasury bonds added 2 basis points to trade at 107.93.