Seoul: Shares end at one-week low on rising US yields

[SEOUL] South Korean shares closed at their lowest level in a week on Friday, as an overnight slump in Wall Street and rising US Treasury yields continued to sap appetite for equities. The Korean won weakened, while the benchmark bond yield rose.

The benchmark Kospi closed down 17.23 points or 0.57 per cent at 3,026.26. The index had dropped as much as 2 per cent to its lowest intraday level since Feb 1.

However, Kospi recorded a weekly gain of 0.44 per cent, rebounding from a 3.05 per cent decline in the previous week.

US stocks dropped sharply overnight after Federal Reserve chair Jerome Powell disappointed investors by not indicating that the Fed might step up purchases of long-term bonds to hold down longer-term interest rates, while the yield on 10-year Treasuries climbed above 1.5 per cent.

Most heavyweights slumped. Technology giant Samsung Electronics slid 0.36 per cent, while peer SK Hynix dropped 1.41 per cent. Internet giant Naver and battery maker Samsung SDI declined 3.58 per cent and 1.03 per cent, respectively.

Foreigners were net sellers of 368.7 billion won (S$438.1 million) worth of shares on the main board.

The won ended at 1,126.1 per dollar on the onshore settlement platform, 0.09 per cent lower than its previous close at 1,125.1.

It slid 0.23 per cent on a weekly basis, after declining 1.57 per cent a week earlier.

In offshore trading, the won was quoted at 1,125.9 per dollar, up 0.4 per cent, while in non-deliverable forward trading its one-month contract was quoted at 1,125.7.

The most liquid three-year Korean treasury bond yield rose by 2.7 basis points to 1.057 per cent, while the benchmark 10-year yield rose by 1.4 basis points to 1.986 per cent.

REUTERS