Seoul: Shares end higher, focus on Britain's fiscal plan
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SOUTH Korean shares closed higher on Monday (Oct 17), reversing sharp losses in early trade led by tech giant Kakao, with investors eyeing developments around Britain’s tax cuts that had brought about a turmoil in global markets.
The Korean won pared much of early losses, while the benchmark bond yield erased all of its gains.
The benchmark Kospi ended up 7.15 points or 0.32 per cent at 2,219.71. Its closing level was nearly 2 per cent higher than the session’s low.
The British finance minister will announce tax and spending measures on Monday, two weeks earlier than previously scheduled, as he tries to turn around a loss of confidence in the government’s fiscal plans.
“Having been continuously affected by the issue, the stock market turned higher after the news with hopes for a reversal of the plan,” said Mirae Asset Securities’ analyst Seo Sang-young.
Kakao ended down 5.93 per cent, after falling nearly 10 per cent to hit the lowest intraday level since May 2020, on a widespread outage in the country’s largest mobile chat application. Affiliates Kakaobank and Kakaopay fell 5.14 per cent and 4.16 per cent, respectively.
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Meanwhile, South Korea’s finance minister said on Sunday the government would scrap taxes on foreigners’ income from investments in treasury bonds and monetary stabilisation bonds starting this week.
Foreigners were net buyers of shares worth 264 billion won (S$262.4 million) on the main board, extending their buying streak to an eleventh session - the longest since late November 2020.
The won closed 0.47 per cent lower at 1,435.3 per dollar on the onshore settlement platform, after falling as much as 0.89 per cent to 1,441.4, just an inch short of hitting a fresh 13-year low.
In money and debt markets, December futures on three-year treasury bonds fell 0.16 point to 101.84.
The most liquid three-year Korean treasury bond yield rose by 1.2 basis points to 4.231 per cent, while the benchmark 10-year yield was unchanged at 4.2 per cent, erasing its early gain of as much as 11 basis points. REUTERS
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