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Seoul: Stocks flat as markets focus on Fed; won firmer
[SEOUL] South Korean shares were trading flat on Tuesday morning after a choppy trading session the day before, with limited support from bargain-hunting offset by broad risk-off sentiment which had offshore investors out of the market for a 10th straight day.
The Korea Composite Stock Price Index (Kospi) was 1,927.64 points as of 0221 GMT, almost unchanged from the previous close of 1.927.82.
With Federal Open Market Committee (FOMC) rate-setting meeting due to take place Dec 15 to Dec 16, the Bank of Korea said late on Monday it would undertake round-the-clock monitoring of global markets, ready to take stabilisation steps if needed after the decision.
"KOSPI will reach its bottom by the time Fed announces its rate decision," said Min Byung-kyu, a stock analyst at Yuanta Securities, noting that a meaningful rotation from bonds back into equities could take place, improving market sentiment.
Commodity-linked companies such oil and chemical refiners underperformed as oil prices resumed declines. S-Oil Corp fell 1.4 per cent and Lotte Chemical Corp slumped 6.5 per cent.
In contrast, tech giant Samsung Electronics Co Ltd and chipmaker SK Hynix Inc rose 0.7 per cent and 1.4 per cent, respectively.
Foreign investors were set for a 10th straight selling session in global risk aversion, dumping a net 128.4 billion Korean won (S$153.09 million) worth of equities on the main bourse by late morning.
The South Korean won was locked in a tight range near mid-session ahead of FOMC meeting set to begin later in the day.
The local currency was quoted at 1,182.6 per dollar, up 0.2 per cent versus with Monday's onshore close of 1,184.8.