Seoul: Stocks end lower on options expiry; BOK in focus

[SEOUL] South Korean shares ended lower on Thursday (Jan 13), dragged by institutional sell-off on the day of Kospi options expiry and ahead of the central bank rate decision, while retail investors refrained from making big bets ahead of the long-awaited public subscription for LG Energy Solution's US$10.7 billion initial public offering (IPO).

The Korean won strengthened, while the benchmark bond yield fell.

The benchmark Kospi closed down 10.39 points, or 0.35 per cent, at 2,962.09, reversing early gains of 0.32 per cent. It rose 1.54 per cent on Wednesday.

Among the heavyweights, Samsung Electronics and LG Chem fell 1.27 per cent and 2.33 per cent, respectively, while SK Hynix and Samsung Biologics added 0.78 per cent and 0.93 per cent each.

Battery maker LG Energy Solution's IPO has received bids worth around US$80 billion from institutional investors, according to sources, 13 times more than the offered US$6 billion, while the public subscription for retail investors will take place on Jan 18 and 19.

Meanwhile, US December inflation data showed price pressures surging, but the data came in line with expectations, which appeared to have reassured investors.

The Bank of Korea (BOK) holds its policy meeting on Friday, where it is expected to raise the base rate to 1.25 per cent to restrain inflationary risks and financial imbalances.

Capping the benchmark index's decline, foreign investors net bought 368.7 billion won (S$418.2 million) worth of Kospi shares.

The won ended at 1,187.5 per dollar on the onshore settlement platform, the strongest level in 2 weeks and 0.25 per cent higher than its previous close.

In offshore trading, the won was quoted at 1,187.7, while in non-deliverable forward trading its 1-month contract was quoted at 1,188.3.

In money and debt markets, March futures on 3-year treasury bonds rose 0.12 point to 108.62.

The benchmark 10-year yield fell by 3.3 basis points to 2.395 per cent.

REUTERS