Seoul stocks open at fresh record high despite hawkish US Fed
Seoul, June 18
Seoul stocks opened at a fresh record high on Thursday, despite overnight losses on Wall Street caused by the US Federal Reserve's signal of a rate hike this year and uncertainty over a US-Iran peace deal.
The benchmark Korea Composite Stock Price Index (KOSPI) was up 32.74 points, or 0.37 percent, to 8,896.98, as of 9:18 a.m, reports Yonhap news agency.
Overnight, major stock indexes closed lower as Fed Chair Kevin Warsh hinted that there could be a rate hike this year to stabilise inflation, after freezing the rate for the fourth straight time.
Major U.S. tech shares led the losses, with big tech companies, such as Microsoft, Apple and Alphabet, all closing in the red.
The two-day policy meeting, the first one under the new Fed chief, concluded with a fourth consecutive rate freeze at a range of 3.5 percent to 3.75 percent.
On the Middle East front, the President Donald Trump administration released the memorandum of understanding with Iran, but Trump emphasised that the agreement was not a final deal, and the United States can resume attacks if "they don't behave."
Han Ji-young, an analyst from Kiwoom Securities said the KOSPI could face short-term correction pressure due to a rapid rise, which lasted for the past five consecutive sessions.
"But the issue is merely the matter of pace, as the current market is backed by valuation appeal and profit momentum," Han added.
In Seoul, large-cap shares were trading mixed.
Top-cap Samsung Electronics inched down 4.3 percent, while its industry rival SK hynix added 3.29 percent.
Top car maker Hyundai Motor fell 1.78 percent, battery maker LG Energy Solution dipped 1.92 percent, while defence giant Hanwha Aerospace rose 0.41 percent.
The Korean won was trading at 1,524.2 won against the U.S. dollar, down 10.8 won from the previous session, as of 9:18 a.m.
— IANS
Reader Comments
KOSPI up 0.37% but Samsung down 4.3% - shows how concentrated Korean market risk is in a few giants. In India, we have broader diversification with Nifty 50. But honestly, global markets all feel like a house of cards with US Fed uncertainty and Middle East tensions. 😰
The Fed's hawkish stance is a mood killer for emerging markets. As an NRI in the US, I see how Indian and Korean stocks get whipsawed by these signals. Trump's Iran 'deal' nonsense just adds more uncertainty. India needs to strengthen its domestic economy to buffer such shocks.
Seoul stocks at record high despite rate hike fears? Shows Korean markets have strong fundamentals. But Indian investors should note - don't blindly copy foreign moves. Our rupee is already under pressure, and RBI's actions matter more than Fed's. Stay invested in quality Indian stocks. 🚀
Kevin Warsh as Fed chair - that guy is more hawkish than a hawk on steroids! 😅 Rate freeze was expected but signaling a hike this year is scary for EM currencies. Korean won at 1,524/$ means imported inflation for them. Reminds me of our 2023 rupee woes. Hope RBI learns from this.
Headline says "fresh record high" but numbers show only 0.37% up - seems like media hype. And Samsung, Hyundai, LG all down! The real story is how Korean economy is too dependent on chaebols. India's wider industrial base gives us more resilience. But won depreciation is painful for any trading nation.
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