South Korean shares pare early gains after central bank holds rate in surprise move
- The benchmark KOSPI closed up 30.68 points, or 1.23%, at 2,527.49
SEOUL: Round-up of South Korean financial markets:
South Korean shares rise; domestic political developments in focus
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South Korean shares pared some of their early gains on Thursday, tracking Wall Street strength overnight, after the Bank of Korea’s surprise move to maintain its key interest rate.
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The won weakened, while the benchmark bond yield fell.
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The benchmark KOSPI closed up 30.68 points, or 1.23%, at 2,527.49, after rising as much as 1.5% earlier in the session.
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US consumer prices increased by the most in nine months in December, data showed on Wednesday, but hopeful signs from a measure of underlying price pressures subsiding, after barely budging for four months raised hopes for a Federal Reserve rate cut in June.
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That led to Wall Street’s three major stock indices rallying.
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“The KOSPI cut earlier gains as the Bank of Korea’s rate decision was interpreted as hawkish,” said Lee Kyoung-min, an analyst at Daishin Securities.
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South Korea’s central bank unexpectedly left its policy rate unchanged and signalled it needs to wait for the domestic political turmoil weighing on the currency to stabilise before it can make further cuts.
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Among index heavyweights, chipmaker Samsung Electronics rose 1.12% and peer SK Hynix gained 5.95%, while battery maker LG Energy Solution climbed 0.14%.
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Of the total 944 traded issues, 600 shares advanced, while 281 declined.
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Foreigners were net buyers of shares worth 498.2 billion won ($341.96 million).
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The won was quoted at 1,456.7 per dollar on the onshore settlement platform, 0.14% lower than Wednesday.
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In money and debt markets, March futures on three-year treasury bonds rose 0.24 point to 106.76.
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The most liquid three-year Korean treasury bond yield fell by 2.4 basis points to 2.623%, while the benchmark 10-year yield fell by 3.3 bps to 2.814%.
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