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Seoul shares rally as softened US inflation eases steep rate hike woesBy Yonhap
Published : Aug. 11, 2022 - 16:10
South Korean stocks jumped 1.73 percent Thursday, taking a cue from an overnight Wall Street rally after softer-than-expected US inflation data helped ease worries about a drastic rate hike by the Federal Reserve, analysts said. The local currency gained ground against the US dollar.
The Korea Composite Stock Price Index (KOSPI) advanced 42.90 points to 2,523.78. Trading volume was moderate at 495.5 million shares worth 9.39 trillion won ($7.26 billion), with advancing stocks far outstripping decliners 771 to 111.
"The US rally that came with a rebound in tech stocks amid the expectations that inflation may peak out will have a positive impact on the South Korean stock market," Seo Sang-young, an analyst at Mirae Asset Securities Co., said.
"We could also expect more foreign net buying if there is more foreign net futures inflow due to the softening inflation," Seo said.
The US consumer price index (CPI) rose 8.5 percent in July, a slowdown from the 9.1 percent gain for June that marked the highest in four decades. It was also slower than market expectations.
Elevated inflation would have reinforced the Fed's case for increasing borrowing costs to bring price increases under control following the consecutive 0.75 percentage-point rate hikes in June and July.
The easing of the July US inflation sent Wall Street rallying on Wednesday (US time), with the S&P 500 hitting a three-month high, the Nasdaq rising 2.89 percent and the Dow Jones Industrial Average gaining 1.63 percent.
In Seoul, foreigners scooped up a net 133.7 billion won of local equities, with institutions buying a net 468 billion won. Individual investors sold off a net 603 billion won.
Shares closed mostly higher across the board, driven by top-listed tech, chemical and steel companies. Market heavyweight Samsung Electronics advanced 1.35 percent to 59,900 won, and top battery maker LG Energy Solution jumped 3.06 percent to 472,000 won.
Leading chemical firm LG Chem rose 1.54 percent to 658,000 won, and steel giant Posco Holdings soared 3.42 percent to 257,000 won.
Domestic business-focused stocks fell. Major mobile carrier KT was down 0.8 percent to 38,150 won, and Samsung Fire & Marine Insurance slipped 0.7 percent to 202,000 won amid the recovery under way in South Korea after record rainfalls.
The local currency ended at 1,303.00 won against the US dollar, up 7.4 won from Wednesday's close. (Yonhap)
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