You are here

Seoul: Stocks flat, won drops after Fed meeting


[SEOUL] Demand for South Korean shares and the won was subdued on Thursday, with investors worried the Federal Reserve might continue raising US rates despite turbulence in much of the global economy.

The Korea Composite Stock Price Index (Kospi) was flat at 1,897.38 points at 0211 GMT, recovering from a slide of around 1 percent earlier in the session as bargain-hunting kicked in.

The local currency was down 0.4 per cent against the dollar from its previous onshore close of 1,202.0, trading at a one-week low.

"Investors are opting for safe-haven assets," said James Huh, an analyst at Samsung Securities.

"However, there is some room to believe that the Fed might change its stance on rates if uncertainty in global financial markets increases and oil prices drop further." The Fed left interest rates unchanged on Wednesday and said it was closely monitoring global economic developments while signaling it wasn't ready to abandon a plan to raise interest rates further this year.

Foreigners started dumping South Korean shares again near mid-session on Thursday, after turning net buyers for the first time on Wednesday following 14 straight sessions of net selling.

On the main bourse, Samsung Electronics Co Ltd was trading down around 2 per cent after it warned of possible weaker earnings this year compared with 2015 due to softer sales of gadgets such as smartphones.

Shares in Samsung C&T Corp were up around 4 per cent despite the company saying on Thursday that it booked 2.6 trillion won (S$3.07 billion) in potential losses in 2015 earnings results. Analysts said the stock was rising on investors' hopes for further restructuring of companies within Samsung Group.

March futures on three-year treasury bonds were down 0.06 points to trade at 109.73.