Kospi drops nearly 2 percent as bond yield worries hit tech stocks
Seoul shares extended losses for a second session as foreign and institutional selling weighed on Samsung Electronics and other technology stocks.
A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 6,803.90 points on Oct. 7, down 137.49 points, or 1.98 percent, from the previous trading session.
YONHAP
Korean stocks dipped by nearly 2 percent on Wednesday to extend their losses for a second consecutive session, led by declines in technology shares, amid concerns over rising bond yields that have climbed to multidecade highs. The won strengthened against the dollar.
The benchmark Kospi extended its losses to close down 137.49 points, or 1.98 percent, at 6,803.90.
After opening 1.11 percent lower, the Kospi briefly turned higher but eventually closed lower as investors remained concerned about elevated bond yields.
Local shares fell despite overnight gains on Wall Street.
Global oil prices fell on easing supply concerns, while bond yields retreated from their multidecade highs.
The Dow Jones Industrial Average rose 0.49 percent, while the tech-heavy Nasdaq composite gained 0.45 percent to reach a record high.
Trade volume was light at 256.76 million shares worth 19.69 trillion won ($14.68 billion), with decliners outnumbering advancers 525 to 332.
Foreigners and institutions sold a net 2.59 trillion won and 672.7 billion, respectively, while individuals bought a net 2.56 trillion won.
"The Kospi came under renewed pressure amid rising international oil prices and U.S. Treasury yields," Lee Kyung-min, an analyst at Daishin Securities, said. "Investors also took a wait-and-see approach ahead of Samsung Electronics' preliminary earnings report, prompting both foreign and institutional investors to become net sellers."
Market heavyweights ended lower.
Market bellwether Samsung Electronics lost 1.29 percent to 268,500 won after opening higher ahead of earnings guidance on Thursday, while chip giant SK hynix went down 2.82 percent to 1.72 million won.
SK Square, the parent company of SK hynix, decreased 1.64 percent to 1.14 million won, while Samsung Electro-Mechanics, an electronics component affiliate of Samsung Electronics, shed 4.24 percent to 1.6 million won.
The won strengthened by 3.2 won from the previous session to close at 1,340.4 against the dollar as of 3:30 p.m.
Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys added 2.8 basis points to 3,961, and the return on the benchmark five-year government bonds went up 1.7 basis points to 4.134.
Yonhap
