Seoul: Shares fall nearly 1% as chipmakers slump

SOUTH Korean shares fell nearly 1 per cent on Friday (Oct 28), as chipmakers slumped, but still ended the week higher amid hopes for a slower monetary tightening pace in the United States.

The Korean won weakened, while the benchmark bond yield dropped.

The benchmark KOSPI fell 20.38 points, or 0.89 per cent, to close at 2,268.40, but still notched a 2.50 per cent gain for the week.

The index was dragged down by heavyweight chipmakers. Samsung Electronics fell 3.70 per cent and SK Hynix dropped 7.33 per cent, marking their biggest daily loss since August 2020 and March 2020, respectively.

“South Korean chipmakers, along with Taiwanese peers, saw sharp losses after US President Joe Biden’s remarks to boost domestic chip production and on heightened worries about restrictions on exports to China,” said Seo Sang-young, an analyst at Mirae Asset Securities.

The Biden administration expects to ink a deal with allies in the near-term to bring them on board with new US rules curbing China’s access to sophisticated chipmaking tools, a senior Commerce Department official said on Thursday.

Automaker Hyundai Motor rose 1.23 per cent, while its affiliates jumped on upbeat third-quarter results. Hyundai Mobis gained 7.35 per cent, Hyundai Glovis advanced 5.17 per cent, and Hyundai Wia added 2.07 per cent.

Foreigners were net sellers of shares worth 191.8 billion won (S$190 million) on the main board, after six consecutive buying sessions. For the week, they net bought one trillion won, the most since early August, in their fifth straight week of buying.

The won was last quoted at 1,421.5 per US dollar on the onshore settlement platform, 0.32 per cent lower than its previous close. The currency ended the week 1.29 per cent higher, its biggest weekly rise since mid-March.

In money and debt markets, December futures on three-year treasury bonds jumped 0.48 point to 102.31.

The most liquid three-year Korean treasury bond yield fell 10.2 basis points to 4.106 per cent, while the benchmark 10-year yield dropped 10.7 basis points to 4.163 per cent. REUTERS