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Korea Herald
6 days ago
- Business
- Korea Herald
Seoul shares spike over 1.6% on US rate cut hopes
South Korean stocks closed sharply higher Tuesday amid heightened expectations the US Federal Reserve may soon pivot to monetary easing following an employment shock. The local currency was trading lower against the US dollar. The benchmark Korea Composite Stock Price Index climbed 50.25 points, or 1.61 percent, to close at 3,198.00. Trade volume was a little slim at 270.8 million shares worth 10.9 trillion won ($7.85 billion), with winners far outnumbering losers 684 to 190. Foreigners and institutions net purchased 291.9 billion won and 94.5 billion won worth of local shares, respectively, while retail investors net sold 471.8 billion won. The KOSPI had opened in positive terrain, tracking overnight gains on Wall Street sparked by hopes the Fed may begin cutting its key rate in September to support the economy. The Dow Jones Industrial Average closed 1.34 percent higher on Monday, with the tech-heavy Nasdaq composite climbing 1.95 percent and the S&P 500 rising 1.47 percent. Such hopes were fueled after the US Bureau of Labor Statistics issued a jobs report, which showed the world's largest economy only added 73,000 jobs in July, below the market projection of a 100,000 job gain. "The Fed has been keeping its rate unchanged, citing the steady employment market, but the situation is different now," said Lee Kyoung-min, an analyst at Daishin Securities. Lee Jae-won, an analyst at Shinhan Securities, said investor sentiment was also improved on news reports the ruling bloc may reconsider its push for a tax revision aimed at raising taxes on corporations and stock investors. Market bellwether Samsung Electronics closed 0.29 percent higher at 69,900 won, and its chipmaking rival SK hynix gained 2.13 percent to 263,500 won, reflecting US chip giant Nvidia's 3.62 percent increase Monday. Leading battery maker LG Energy Solution jumped 2.93 percent to 386,500 won, and its smaller rival Samsung SDI shot up 10.22 percent to 213,500 won. Financial shares were particularly bullish, with KB Financial spiking 3.69 percent to 112,400 won and Shinhan Financial surging 3.19 percent to 68,000 won. Major shipbuilders also finished strong, with Hanwha Ocean climbing 1.57 percent to 116,100 won, and HD Korea Shipbuilding shooting up 5.63 percent to 356,500 won. Bio firm SK Biopharm skyrocketed 15.92 percent to 111,400 won on the back of record second quarter earnings driven by strong sales of its new epilepsy medication Xcopri. The state-run Korea Electric Power Corp. increased 2.15 percent to 38,300 won, and defense powerhouse Hanwha Aerospace soared 2.45 percent to 961,000 won. Auto and IT shares were among the few losers. Top automaker Hyundai Motor went down 0.24 percent to 210,500 won, and its sister Kia lost 1.36 percent to 101,400 won. Kakao, the operator of the country's dominant mobile messenger, slid 1.26 percent to 54,700 won, and top internet portal operator Naver dipped 0.22 percent to 232,000 won. The local currency was quoted at 1,388.3 won against the greenback at 3:30 p.m., down 3.1 won from the previous session. (Yonhap)
Korea Herald
01-08-2025
- Business
- Korea Herald
Korean stocks tumble on tax reform letdown, trade uncertainty
South Korea's benchmark Kospi slumped nearly 4 percent on Friday, marking its steepest single-day drop in two months, as investor optimism soured following disappointment over the government's tax code revision and mounting uncertainty over US tariff talks. The Kospi closed at 3,119.41, down 3.88 percent from the previous session. The selloff was led by institutional and foreign investors, who offloaded 10.7 trillion won ($7.6 billion) and 656.5 billion won worth of shares, respectively. Retail investors extended profit-taking for a second straight day, snapping up a net 1.63 trillion won worth of shares on Friday alone. Friday's plunge snapped a rally that had gained momentum since President Lee Jae Myung took office on June 4, fueled by expectations of market-friendly policies. Those hopes had propelled the Kospi 20 percent, with the index setting a new annual high of 3,288 just a day earlier. But Thursday's late-session profit-taking signaled growing caution, which deepened sharply the following day. Friday's decline marked the largest daily fall in two months and dragged the index below the 3,200 level for the first time in five sessions. Markets reacted negatively to details of the tax code overhaul unveiled late Thursday, which fell short of investor expectations. Key changes include lowering the capital gains tax threshold for major shareholders to 1 billion won from 5 billion won, and reinstating the stock transaction tax, which imposes a 0.2 percent levy on financial investment income. While separate taxation for dividend income is designed to boost investment, the higher-than-expected top tax rate of 35 percent on income exceeding 300 million won sparked concern among investors and companies, particularly those working to improve dividend payouts. Sentiment was further dented by lingering uncertainties over trade policy. Although Korea and the US reached an agreement the previous day to apply a 15 percent tariff on Korean imports, which is lower than the initially threatened 25 percent, lingering concerns over Free Trade Agreement-beneficiary sectors, such as autos, continued to weigh on the market. The tech-heavy Kosdaq index fared even worse, tumbling 4.03 percent to close at 772.79, finishing below 800 first time since July 15. Spreading uncertainty has weakened the Korean won, pushing it above the 1,400 mark against the US dollar for the first time in about two months. As of 4:30 p.m., the won was trading at 1,404 won per greenback. 'Policy momentum had been one of the strongest drivers of the July rally,' said Lee Jae-won, an analyst at Shinhan Securities. 'That pillar crumbled under the weight of investor disappointment, fueling the sharp decline.' Lee noted that Friday's heavy foreign net selling was particularly critical in triggering the rout. Lee Kyoung-min of Daeshin Securities said the market is entering a consolidation phase as the second-quarter earnings season unfolds and recent overheating unwinds. 'As investors reassess earnings across sectors that had surged on optimism or slumped on concerns, we expect rotation and relative value adjustments to accelerate,' Lee said. 'Even small triggers could prompt swift profit-taking and a rapid unwinding of overheated positions, warranting caution.' jwc@
Korea Herald
22-07-2025
- Business
- Korea Herald
Seoul shares sink over 1% ahead of tariff deadline, Q2 earnings
Seoul shares closed sharply lower Tuesday as investors cashed in recent gains amid uncertainties with US tariff policies and upcoming corporate earnings. The Korean won rose against the US dollar. The benchmark Korea Composite Stock Price Index fell 40.87 points, or 1.27 percent, to close at 3,169.94. Trade volume was moderate at 375.19 million shares worth 11.39 trillion won ($8.2 billion), with losers outnumbering winners 686 to 208. Institutional and foreign investors sold 413.94 billion won and 160.97 billion won worth of stocks, respectively, while individuals bought a net 511.44 billion won in shares. "Institutions and foreigners turned net sellers after buying local stocks for the past three and eight sessions, respectively, weighing on the market," said Lee Jae-won, an analyst at Shinhan Securities Co. In contrast, retail investors turned net buyers after selling for the previous three sessions. All eyes are on possible changes to US tariff policies, as President Donald Trump may announce new unilateral tariffs before Aug. 1, analysts said. Investors are also awaiting second-quarter corporate earnings, due this week, for clues about the market's direction, they added. In Seoul, most large-cap stocks declined. Market bellwether Samsung Electronics fell 2.65 percent to 66,000 won, and smaller chipmaking rival SK hynix declined 1.47 percent to 268,500 won. Top carmaker Hyundai Motor dropped 1.2 percent to 206,500 won, leading shipbuilder HD Hyundai shed 0.8 percent to 136,100 won, and No. 1 steelmaker POSCO Holdings lost 1.22 percent to 323,000 won. Among gainers, leading battery maker LG Energy Solution rose 0.76 percent to 333,500 won, and LG Chem climbed 0.7 percent to 289,000 won. Leading wireless services provider SK Telecom gained 1.07 percent to 56,500 won, and state-run utility firm Korea Electric Power Corp. was up 0.27 percent to 37,250 won. The local currency was quoted at 1,387.80 won against the US dollar at 3:30 p.m., up 0.4 won from the previous session. (Yonhap)
Korea Herald
11-07-2025
- Business
- Korea Herald
Kospi hits 3,200 intraday milestone, closes lower amid profit-taking
South Korea's benchmark Kospi surged past the 3,200 milestone during intraday trading Friday for the first time in nearly four years, marking a new high in its ongoing rally. The Kospi opened at 3,186.35, up 0.1 percent from the previous day's close, extending Thursday's gains. Shortly after the opening bell, the index jumped past 3,200 and reached as high as 3,216.69 — a new year-high. After hitting its intraday peak, the index quickly pared gains and dropped to as low as 3,170.46 during afternoon trading. It ended the session at 3,175.77, down 0.23 percent, unable to reclaim the 3,200 mark by the close. Friday's rally marked the first time the benchmark index had surpassed the 3,200 threshold since September 2021. The latest milestone came just a day after the Kospi closed at a fresh high of 3,183.23 on Thursday. The Kospi first closed above the historic 3,000 mark on June 20, shortly after the presidential election. Just four days later, on June 24, it crossed the 3,100 level. Though the index dipped below 3,200 by the close on Friday, its intraday milestone — reached in under a month — underscores the market's upward momentum. Friday's advance was largely fueled by a buying spree from retail investors, who net purchased 146.6 billion won ($106 million) worth of shares on the Kospi, reinforcing signs of renewed domestic investor confidence. However, foreign and institutional investors capped gains by offloading 126.3 billion won and 66.6 billion won in shares, respectively. Among blue-chip stocks, Samsung Electronics and its preferred shares gained more than 2 percent on growing expectations of improved earnings in the second half of the year. LG Energy Solution (+1.1 percent), Kia (+0.7 percent) and KB Financial Group (+0.43 percent) also posted modest gains. On the other hand, Naver (-2.5 percent), Samsung Biologics (-2.13 percent) and SK hynix (-0.84 percent) saw declines. 'Amid expectations that Samsung Electronics' earnings will improve in the second half of this year, foreign buying strengthened. The market turned around Friday as underperforming large-cap stocks such as Samsung Electronics and secondary battery companies rebounded,' said Lee Jae-won, an analyst at Shinhan Securities. The secondary Kosdaq index closed at 800.47, up 0.35 percent on the day. During intraday trading, it climbed as high as 805.9, returning to the 800-point range for the first time since June 25. Unlike the Kospi, foreign and institutional investors were net buyers on the Kosdaq, purchasing shares worth 56.7 billion won and 9.5 billion won, respectively. Retail investors offloaded shares worth 63.7 billion won.
Korea Herald
01-07-2025
- Business
- Korea Herald
Kospi hits fresh high on easing global trade tensions, strong exports
Market watchers see room for further gains on Q2 earnings and policy tailwinds South Korea's Kospi climbed to a fresh annual high Tuesday, buoyed by overnight gains on Wall Street and optimism over easing global trade tensions. The benchmark index opened 0.58 percent higher at 3,089.64 and briefly surpassed the 3,130 mark around 9:35 a.m. It extended gains to reach 3,133.52 by 10:20 a.m., up 2 percent and exceeding its previous peak of 3,129.09 set last Wednesday — the highest level in nearly four years. Buying momentum was strong Tuesday morning, with the index hovering around 3,130. However, the rally lost steam in the afternoon, with the Kospi eventually drifting toward 3,090 by the close. Foreigners returned to net buying on Tuesday after four straight sessions of heavy selling, during which they offloaded 2.2 trillion won ($1.6 billion) in Kospi shares. By 3:30 p.m., they had net purchased over 100 billion won, with their buying fluctuating notably throughout the session. Foreigners trailed institutional investors, who led the rally with a net purchase of over 500 billion won. Retail investors turned net sellers, unloading about 650 billion won to lock in gains. The Kosdaq also posted modest gains, opening 0.42 percent higher at 784.8 and climbing to an intraday peak of 788.38. Institutional investors were net buyers, while retail and foreign investors trimmed their positions. Equities drew support from a strong overnight performance in US markets, where the S&P 500 closed at a record 6,207.95 and the tech-focused Nasdaq hit 20,369.73. Analysts attributed Wall Street's gains to optimism ahead of second-quarter earnings and easing trade tensions, including Canada's withdrawal of a planned digital tax and a 2 percent jump in Apple shares on AI momentum. Investor sentiment in Seoul was further lifted by robust export figures and rising expectations for market-friendly regulatory reforms. 'Korea's exports rose 4.3 percent on-year in June, with semiconductors hitting an all-time high and autos marking their strongest June on record,' said Lee Jae-won, a strategist at Shinhan Securities. 'On top, a proposed amendment to the Commercial Act is being tabled at the Legislation and Judiciary Committee today, and opposition parties that once opposed it are shifting stance, raising expectations for its passage this week.' The ruling Democratic Party of Korea is pushing to revise the Commercial Act to improve corporate governance and bolster minority shareholder rights, aiming to pass the bill before the June provisional parliamentary session ends this week. Han Ji-young, an analyst at Kiwoom Securities, said it is too soon to call an end to the market's upward momentum. 'There are still several potential upside catalysts this month, including the impact of Trump's universal tariffs, the second-quarter earnings and the details of the Commercial Act amendment,' he said. 'The recent pullback in Korean equities should be seen as a period of consolidation (not a trend reversal).'
