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Seoul shares close lower on tech losses ahead of Fed's rate decision

By Yonhap

Published : Sept. 19, 2023 - 16:05

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

South Korean stocks closed lower for the second consecutive day Tuesday, hit by sharp losses in semiconductor and major tech shares ahead of a US rate-setting meeting. The local currency slid against the US dollar.

The benchmark Korea Composite Stock Price Index lost 15.51 points, or 0.6 percent, to finish at 2,559.21.

Trading volume was moderate at 455.9 million shares worth 7.6 trillion won ($5.7 billion), with decliners outpacing winners 577 to 302.

Offshore and retail investors purchased 2.6 billion won and 360.6 billion worth of local shares, respectively, while institutions sold off a net 385.5 billion won.

Overnight, US stocks closed little changed as investors stayed cautious ahead of the Federal Reserve's rate decision. The Dow Jones Industrial Average grew 0.02 percent, the tech-heavy Nasdaq Composite inched up 0.01 percent, and the S&P 500 rose 0.07 percent.

The Fed will hold the Federal Open Market Committee for two days starting Tuesday and is expected to keep rates on hold.

But the market expects the US central bank may deliver one more rate hike this year, given the solid economic recovery of the world's largest economy.

"The market didn't show a clear direction ahead of the FOMC meeting, but big-cap stocks on the KOSPI retreated overall as foreigners sold off futures," Kim Seok-hwan, an analyst from Mirae Asset Securities, said.

"In particular, semiconductor shares were weak, including Samsung Electronics, which sank under the 70,000-won mark, and domestic secondary battery shares also fell due to Tesla Inc.'s slide in the US stock markets," Kim added.

Samsung Electronics, one of the world's biggest chipmakers, retreated 0.57 percent to 69,800 won, and leading chemical producer LG Chem shot down 3.66 percent.

Leading battery maker LG Energy Solution sank 2.07 percent to 496,500 won, and its smaller rival Samsung SDI dropped 1.59 percent to 558,000 won.

Steel giant Posco Holdings went down 1.66 percent to 593,000 won, its materials unit Posco Future M plunged 3.41 percent to 396,500 won, and its energy trading unit Posco International lost 2.22 percent to 79,400 won.

IT stocks also ended in negative terrain, with top online portal operator Naver down 0.9 percent to 219,500 won and Kakao, the operator of the popular mobile messenger, down 1.54 percent to 47,850 won.

Top automaker Hyundai Motor also lost 0.52 percent to 190,000 won, while its smaller affiliate Kia remained flat at 79,400 won.

No. 2 chipmaker SK hynix, meanwhile, inched up 0.17 percent to 119,200 won.

The Korean won ended at 1,328.50 won against the US dollar, down 4.1 won from Monday's close. (Yonhap)