Seoul: Shares hit 6-week high on Fed outcome; won rises above 1,300-mark
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SOUTH Korean shares rose for a fourth straight day on Thursday (Jul 28) to their highest in 6 weeks, with investors relieved by the outcome of the US Federal Reserve’s monetary policy meeting. The Korean won saw its best day in 2 months, while the benchmark bond yield rose.
The benchmark Kospi ended up 19.74 points or 0.82 per cent at 2,435.27, the highest close since Jun 17.
The index rose for the fourth consecutive session, marking the longest gaining streak since early March.
The US Federal Reserve raised its base rate by 75 basis points, as widely expected, on Wednesday, and its Chair Jerome Powell dropped guidance on the size of the next rate rise and noted that “at some point” it would be appropriate to slow down.
The market heard what it wanted to hear, but there was no major shift in the Fed’s monetary policy direction, said Bookook Securities analyst Lee Won, who added investors should be cautious of volatility increasing a couple days later on different interpretations.
Samsung Electronics erased early gains and ended up 0.16 per cent after the technology giant cautioned that chip demand from smartphone and PC makers would weaken further as people shop less, and that the more resilient demand from server clients may also see adjustments amid recession worries.
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Peer chipmaker SK Hynix fell 0.6 per cent, while battery maker LG Energy Solution jumped 5.59 per cent and its parent LG Chem rose 5.84 per cent.
Foreigners were net buyers of 407.9 billion won (S$433.3 million) worth of shares on the main board, of which LG Energy Solution shares accounted for more than half.
The won rose above 1,300-level for the first time in more than 2 weeks and ended the session 1.33 per cent higher at 1,296.1 per dollar. The currency marked its biggest daily gain since May 30.
In money and debt markets, September futures on 3-year treasury bonds fell 0.08 point to 105.19 in late afternoon trade.
The most liquid 3-year Korean treasury bond yield rose by 0.8 basis points to 3.109 per cent, while the benchmark 10-year yield rose by 5.8 basis points to 3.19 per cent. REUTERS
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