Seoul shares trim earlier gains on retail selling, Iran tensions
Seoul, July 9
Seoul shares trimmed earlier gains late Thursday morning on retail selling, though institutions and foreigners bought bargain-priced chip stocks following the recent massive sell-off.
After opening 3.3 percent higher, the benchmark Korea Composite Stock Price Index (KOSPI) erased its earlier gains and moved up 150.61 points, or 2.08 percent from the day before, to 7,397.40 as of 11:20 am, reports Yonhap news agency.
Despite the gains, investors remain concerned about renewed geopolitical tensions in the Middle East, as well as uncertainty over the next phase of artificial intelligence (AI) demand, analysts said.
Overnight, U.S. stocks ended mixed. The Dow Jones Industrial Average fell 1.09 percent, while the tech-heavy Nasdaq composite rose 0.2 percent.
Institutions and foreigners bought a net 985.8 billion won (US$655 million) and 144.9 billion won worth of stocks, respectively, while individuals sold a net 1.07 trillion won.
Tech stocks led the gains. Market bellwether Samsung Electronics rose 1.8 percent, while chip giant SK hynix jumped 6.65 percent after reports that its U.S. listing was more than seven times oversubscribed.
Leading wireless services provider SK Telecom climbed 4.52 percent, and budget carrier Air Busan gained 7.5 percent.
Among decliners, top carmaker Hyundai Motor fell 2.38 percent, and defence firm Hanwha Aerospace declined 6.72 percent.
The Korean won was trading at 1,504.65 won per U.S. dollar as of 11:20 a.m., down 2.25 won from the previous session.
Meanwhile, South Korea's finance ministry said it has issued euro-denominated foreign exchange (FX) stabilisation bonds worth 1.7 billion euros (US$1.94 billion), reflecting the country's solid standing in the global financial market.
The Ministry of Finance and Economy said the euro bonds were issued the previous day with maturities of three and seven years, marking Seoul's largest-ever euro-denominated FX stabilisation bond issuance.
The FX stabilisation bonds are issued to secure foreign currency funds to help cope with external financial uncertainties.
— IANS
Reader Comments
South Korea issuing euro bonds at this time is smart—$1.94B is huge! 😮 It shows confidence in their economy despite geopolitical headwinds. For India, I hope our government also considers similar FX stabilisation moves if the rupee faces pressure. Korean won weakening to 1,504 is a concern though.
Retail selling is always a pattern—small investors panic while institutions buy the dip. But with Iran tensions, it's understandable. Korea's chip stocks recovery is interesting because it directly impacts global supply chains, including India's electronics manufacturing. We should leverage this to boost our own chip ecosystem.
Seoul market's 2% gain is decent, but the intraday volatility shows uncertainty. The Dow falling 1% overnight reflects broader US concerns. For emerging markets like India, these fluctuations often lead to FII outflows. Let's hope the AI-driven demand stabilises soon—it's a key growth driver for both Korea and India.
Hyundai and Hanwha declining while tech stocks rise—classic sector rotation. For Indian investors, this is a reminder to diversify globally. The Korean won dropping 2.25 won is minor, but if Middle East tensions escalate, we might see similar pressure on the rupee. 😐
The oversubscribed SK hynix US listing is a big vote of confidence for Korean chipmakers. For India, this highlights the gap—we need policy reforms to attract similar capital for our tech sector. The 1.7B euro bond issuance is also a good lesson in financial prudence during uncertain times.
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