Seoul: Shares drop 1% on inflation concerns; won declines most in 15 months
SOUTH Korean snapped a 3-session rally on Thursday (Jun 2) to end 1 per cent lower, dragged down by fears that unruly inflation and tightening monetary policy globally would hurt economic growth. The Korean won saw its worst day in 15 months, while the benchmark bond yield jumped.
The benchmark Kospi ended down 26.91 points, or 1 per cent, at 2,658.99.
Economic data from the eurozone and the US fanned worries about inflationary pressures, while investors also took profits after a recent rally, said Samsung Securities’ analyst Seo Jung-hun.
South Korea’s exports grew at a faster pace in May than April, as higher shipments to Europe and the US more than offset trade disruptions with China from its strict Covid-19 restrictions.
Meanwhile, a private-sector survey showed the country’s factory activity growth slowed in May as output and export orders contracted amid supply-chain disruptions due to China’s Covid-19 lockdown measures.
Among the heavyweights, technology giant Samsung Electronics fell 1.04 per cent and peer SK Hynix lost 0.93 per cent, while battery maker LG Energy Solution slid 0.79 per cent.
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Foreigners were net sellers of 102.7 billion won (S$113 million) worth of shares on the main board.
The won was last quoted at 1,252.1 per dollar on the onshore settlement platform, 1.19 per cent lower than its previous close, marking the worst daily performance since Feb 26, 2021.
In offshore trading, the won was quoted at 1,251.5 per dollar, down 0.4 per cent from the previous day, while in non-deliverable forward trading its 1-month contract was quoted at 1,251.3.
In money and debt markets, June futures on 3-year treasury bonds fell 0.3 point to 105.13 in late afternoon trade.
The most liquid 3-year Korean treasury bond yield jumped by 9.4 basis points to 3.118 per cent, while the benchmark 10-year yield surged by 11 basis points to 3.434 per cent. REUTERS
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