The Korea Herald


Seoul shares at 1-year high on hopes Fed pauses rate hikes

By Yonhap

Published : June 2, 2023 - 16:52

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An electronic board showing the Korea Composite Stock Price Index at a dealing room of the Hana Bank headquarters in Seoul on Friday. (Yonhap) An electronic board showing the Korea Composite Stock Price Index at a dealing room of the Hana Bank headquarters in Seoul on Friday. (Yonhap)

South Korean stocks closed at a one-year high Friday, led by large-cap tech gains, on hopes the Federal Reserve will pause its aggressive monetary tightening and the United States' debt ceiling deal will pass. The local currency rose against the US dollar.

The benchmark Korea Composite Stock Price Index added 32.19 points, or 1.25 percent, to close at 2,601.36. It was the first time for the index to surpass the 2,600 level since June 9, 2022.

Trading volume was moderate at 559.56 million shares worth 9.16 trillion won ($6.09 billion), with gainers outpacing decliners 601 to 270.

The KOSPI went up 1.66 percent this week from a week ago.

The index opened higher, tracking overnight gains on Wall Street, and had risen further on solid buying by foreign investors.

Overseas and institutional investors bought a net 374 billion won and 197 billion won worth of shares, respectively, while retailers sold a net 570 billion won worth of shares.

Investors welcomed the news that the US Congress passed the bill to raise the federal debt ceiling to avert a default.

Eyes are also on the US monthly jobs data for May to be released Friday, as expectations of a moderate rise in hiring raised hopes for the Fed to pause the interest rate hikes at the next policy meeting set for June 13-14.

Fed Bank of Philadelphia President Patrick Harker said Thursday the US central bank "should at least skip this meeting in terms of an increase."

Major tech shares led the upturn of the KOSPI.

Market bellwether Samsung Electronics surged 1.83 percent to 72,200 won after US chip giant Nvidia spiked 5.12 percent. But chip giant SK hynix remained unchanged at 110,300 won following recent sharp gains.

Leading battery maker LG Energy Solution rose 0.68 percent to 588,000 won, and LG Chem jumped 4.95 percent to 721,000 won. Samsung SDI also went up 0.99 percent to 715,000 won.

Carmakers ended higher, with top automaker Hyundai Motor advancing 1.01 percent to 199,500 won and its affiliate Kia rising 1.19 percent to 85,200 won.

No. 1 steelmaker POSCO Holdings climbed 4.29 percent to 376,500 won, and POSCO Future M soared 4.03 percent to 374,000 won on news that POSCO Future M has agreed with US General Motors to build a facility to manufacture precursors, expanding their joint venture into the production of the intermediate battery material.

Platform operators also gathered ground. Internet giant Naver inched up 0.25 percent to 204,000 won, and Kakao, the operator of the popular mobile messenger KakaoTalk, jumped 1.96 percent to 57,200 won.

But major shares fell. Samsung Biologics shed 0.38 percent to 785,000 won, and Celltrion lost 1.08 percent to 173,500 won.

The local currency ended at 1,305.7 won against the US dollar, up 15.9 won from the previous session's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys fell 4.2 basis points to 3.436 percent, and the return on the benchmark five-year government bond lost 5.9 basis points to 3.405 percent. (Yonhap)