Seoul: Shares log biggest daily gain in 16 months; third weekly loss

SOUTH Korean shares marked the sharpest daily jump in 16 months, tracking gains on Wall Street after investors scaled back expectations for inflation and interest-rate hikes, although the benchmark index logged a third straight weekly drop.

The Korean won strengthened, while the benchmark bond yield fell. The index declined 3.05 per cent for the week, a third straight weekly drop.

The benchmark Kospi rose 52.28 points or 2.26 per cent to 2,366.6 as of 6.32 am GMT, the sharpest daily jump since February 2021.

Among heavyweights, messenger platform operator Kakao jumped 6.6 per cent, Naver gained 5.8 per cent, technology giant Samsung Electronics rose 1.74 per cent and peer SK Hynix rose 1.55 per cent, while battery maker LG Energy Solution rose 1.25 per cent.

South Korean shares are catching up as it has been suffering bigger declines since early June on global uncertainties, compared with shares in China and Taiwan, said Park Gwang-nam, an analyst at Mirae Asset Securities.

Manufacturing growth is slowing worldwide as China’s Covid-19 curbs and Russia’s invasion of Ukraine disrupt supply chains and keep inflation at the highest in years, while the growing risk of a US recession poses a new threat to the global economy.

Foreigners were net sellers of 35.4 billion won (S$37.9 million) worth of shares on the main board.

The won was quoted at 1,298.2 per dollar on the onshore settlement platform, 0.28 per cent higher than its previous close at 1,301.8.

In offshore trading, the won was quoted at 1,298.1 per dollar, up 0.1 per cent from the previous day, while in non-deliverable forward trading its 1-month contract was quoted at 1,297.4.

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In money and debt markets, September futures on 3-year treasury bonds rose 0.34 point to 103.54, while the 3-month Certificate of Deposit rate was quoted at 2 per cent in late afternoon trade.

The most liquid 3-year Korean treasury bond yield fell by 7.1 basis points to 3.526 per cent, while the benchmark 10-year yield fell by 5.1 basis points to 3.644 per cent. REUTERS