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S. Korean stocks open lower amidst rate hike, China’s slowing economy

S. Korean stocks open lower amidst rate hike, China’s slowing economy
S. Korean stocks open lower amidst rate hike, China’s slowing economy

South Korean shares reportedly ended lower on Monday, as investors grew concerned about the US Federal Reserve's hawkish monetary tightening as well as China's economic momentum in face of high inflation and a prolonged COVID-19 outbreak.

The Korean won also supposedly dropped in value against the US dollar. The standard Korea Composite Stock Price Index (Kospi) fell 7.29 points to 2,693.10 points or 0.27%.

Losers outnumbered gainers 438 to 399 in a medium trading volume of roughly 730.81 million stocks worth about ₩8.71 trillion (US$7.06 billion).

Foreigners sold ₩135.4 billion (US$110 million) worth of stocks, while institutional and retail investors bought ₩2.9 billion (US$2 million) and ₩125.4 billion (US$101.97 million) worth of shares, respectively.

Investors have been apprehensive of the Federal Reserve's forecasts of faster-than-expected inflationary tightening, which have fueled fears of a worldwide economic slowdown.

Inflationary pressures in China are also a cause of concern.

China's producer pricing index increased 8.3% year on year in March, while the consumer price index increased 1.5%, both higher than predicted.

The exorbitant pricing coincided with Shanghai's two-week-long quarantine due to an increase in viral infections. It was expected that the social distancing restrictions would further disrupt global supply networks, affecting the Chinese as well as the global economy.

In Seoul, battery, technology, and biotech stocks all lost ground, dragging the index lower.

LG Energy Solution dropped 3.30% to ₩425,000 (US$345.59), while Samsung SDI dropped 2.66% to ₩585,000 (US$475.76).

SK Hynix, the prominent South Korean chipmaker, fell 0.45% to ₩111,500 (US$90.68), while LG Chem fell 2.86% to ₩510,000(US$414.77).

Samsung Biologics fell 0.99% to ₩801,000 (US$651.43), while Celltrion fell 1.22% to ₩162,000 (US$131.75), as bio stocks fell.

After just a four-day losing streak, market leader Samsung Electronics gained 0.15% to ₩67,900 (US$55.22). On an excellent first-quarter earnings projection, LG Electronics rose 2.46% to ₩125,000 (US$101.66).

KB Financial Group increased by 2.41% to ₩59,600 (US$ 48.47), while Samsung Life increased by 1.86% to ₩65,700 (US$53.43).

Automobile stocks have also risen as a result of bargain shopping. Hyundai Motor gained 1.70% to ₩179,500 (US$145.98), while its subsidiary Kia gained 3.47% to ₩77,500 (US$63.03).

The local currency fell over ₩8.2 from the earlier session to more than ₩1,233.1 against the US dollar.

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Aakriti Rao

Aakriti Rao

Aakriti Rao has always had a flair to pen down crisp and quirky content. A qualified English Literature graduate, Aakriti’s forte lies in creating content for varied genres in an utmost interactive way. Presently, she works as a content developer and writes articles spanning the latest business trends, market research, and industry news for Cue Report.