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Seoul: Stocks, won fall on Yellen comments
[SEOUL] South Korean shares and the won fell early on Thursday, after comments from Federal Reserve Chair Janet Yellen reinforced views for a possible rise in U.S. interest rates in December.
The Korea Composite Stock Price Index (KOSPI) was down 0.4 per cent at 2,045.06 points as of 0224 GMT, set to snap a 3-day winning streak. Losers outnumbered gainers by 13-to-10.
In the currency market, the South Korean won slipped 0.4 per cent to 1,136.9 against the dollar, poised to break a four-day climb.
In her first public comments since the Fed's meeting last week, Yellen said the United States was ready for higher interest rates if upcoming economic data - low unemployment, continued growth and faith in a coming return of inflation -justify them.
"We are expecting foreign inflows to retreat after buying for three straight sessions as Yellen's comments opened the door for a rate hike in December by the Fed," said Kim Yong-goo, a stock market analyst at Samsung Securities.
Kim added that volatility in the currency market had been turning investors to domestic consumption-related sectors such as the bio sector due to sustained weakness in local exports.
Pharmaceuticals outperformed the main bourse, with Chong Kun Dang Pharmaceutical Corp gaining 4.3 per cent and Hanmi Pharm Co Ltd up 0.9 per cent, reaching its highest since July 29.
Shipbuilders lost ground early in the session as Daewoo Shipbuilding & Marine Engineering Co Ltd, South Korea's second-largest shipbuilder, lost 1.5 per cent and Samsung Heavy Industries Co Ltd was down 2.6 per cent.
Offshore investors sold a net 29.3 billion Korean won (S$36.2 million) worth of KOSPI shares by midday.
December futures on three-year treasury bonds shed 0.04 to 109.47.