Seoul: Shares fall, losses capped by hopes of China Covid rules easing
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SOUTH Korean shares fell for a second straight session on Thursday (Oct 20), tracking Wall Street’s weakness, though they recovered some of the early losses on reports of China’s possible Covid-19 restriction cut. The Korean won weakened, while the benchmark bond yield rose.
The benchmark Kospi ended down 19.35 points or 0.86 per cent at 2,218.09, pulling back from a slide of as much as 1.65 per cent in early trade.
China is considering a cut in the duration of quarantine for inbound visitors from 10 to seven days, according to a media report on Thursday.
“The market reacted to the news on China’s Covid-19 restrictions. But, with rising infections and ‘zero-Covid’ policy, it is unsure whether it would have much meaningful impact,” said Mirae Asset Securities’ analyst Kim Seok-hwan.
South Korea’s financial regulator may to ease some of the liquidity requirements for financial companies as there are signs of stress in the short-term money market, the head of the top financial regulatory agency said.
Amid rising concerns of a liquidity crunch, security brokerages slumped. Kiwoom Securities dropped 8.26 per cent, Korea Investment Holdings fell 6.36 per cent, and Eugene Investment and Securities lost 7.27 per cent, among others.
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Among heavyweights, technology giant Samsung Electronics fell 0.54 per cent and peer SK Hynix dropped 2.91 per cent. Battery maker LG Energy Solution declined 0.5 per cent.
Foreigners were net sellers of shares worth 24 billion won (S$23.9 million) on the main board, snapping a 13-session buying streak.
The won was last quoted at 1,433.3 per dollar on the onshore settlement platform, 0.5 per cent lower than its previous close.
In money and debt markets, December futures on three-year treasury bonds fell 0.02 point to 101.49.
The most liquid three-year Korean treasury bond yield fell by 0.4 basis point to 4.319 per cent, while the benchmark 10-year yield rose by 3.7 basis points to 4.415 per cent. REUTERS
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