Seoul: Stocks drop 3% on Wall St tech rout, higher US yields

[SEOUL] South Korean shares tumbled on Friday, reversing almost all gains clocked in the previous session, as a tech rout on Wall Street and a steep rise in US Treasury yields weighed.

The won weakened, while the benchmark bond yield rose.

The benchmark Kospi fell 85.74 points or 2.8 per cent to 3,013.95 by 0143 GMT, after jumping 3.5 per cent in the previous session.

A drop in technology shares sank Wall Street overnight, while the US Treasury yields vaulted to their highest since the pandemic began on expectations of a strong economic expansion and related inflation.

Most heavyweights slid, with technology giants Samsung Electronics and peer SK Hynix slumping 3.6 per cent and 4.4 per cent respectively, while Naver and LG Chem fell 2.4 per cent 4.8 per cent.

Meanwhile, South Korea's exports likely grew for a fourth straight month in February, a Reuters poll showed, thanks to improving global trade, hopes of a vaccine-led recovery and demand for semiconductors and cars. Full-month data is due on March 1.

The Bank of Korea plans to make outright purchases of treasury bonds worth around 5 to 7 trillion won (S$5.9-S$8.3 billion) during the first half of the year, a day after it kept the benchmark interest rate steady.

Foreigners were net sellers of 857.0 billion won worth of shares on the main board.

The won was quoted at 1,120.9 per US dollar on the onshore settlement platform, down 1.2 per cent.

In offshore trading, the won was quoted at 1,119.5, while in non-deliverable forward trading its one-month contract was quoted at 1,119.4.

The most liquid three-year Korean treasury bond yield rose by 2.8 basis points to 1.022 per cent, while the benchmark 10-year yield rose by 7.8 basis points to 1.959 per cent.

REUTERS