South Korean shares slump 7% on renewed selling in chipmakers, c.bank hikes rates
South Korean shares experienced a significant decline on Thursday, driven by chipmaker stock sell-offs. The Bank of Korea raised its benchmark interest rate for the first time in over three years. This move aimed to stabilize the nation's weakenin...
By Reuters |
IANS
South Korean shares slid 7% on Thursday on renewed selling in chipmakers' stocks, while its central bank delivered a highly anticipated interest rate hike for the first time in over three years to stabilise the currency.
The benchmark KOSPI was down 502.44 points, or 6.90%, at 6,781.97 as of 0113 GMT, more than erasing the previous session's gains. Sharp declines also triggered a "sidecar" trading curb, temporarily halting program trading.
The seven-member monetary policy board at the Bank of Korea voted to raise the seven-day repurchase rate by 25 basis points to 2.75% to shore up the won, which has weakened around 3% against the U.S. dollar this year.
The rate hike, predicted by all but one of 37 economists surveyed in a Reuters poll, aligns the BOK closely with regional neighbour the Bank of Japan, which recently raised its own benchmark rate to a 31-year high.
The won was last quoted at 1,487.6 per dollar on the onshore settlement platform, slightly below the nine-week high of 1,483.9 a dollar touched earlier.
Among equities, the world's leading AI chipmaker SK Hynix tumbled as much as 11.7%, while rival Samsung Electronics fell 8.9%. Battery maker LG Energy Solution climbed 1.79%.
SK Hynix and Samsung Electronics make up just over half of the benchmark KOSPI index.
Hyundai Motor and sister automaker Kia Corp were down 2.30% and up 0.69%, respectively. Steelmaker POSCO Holdings shed 0.48%, while drugmaker Samsung BioLogics fell 0.51%.
Of the 904 issues traded, 433 shares advanced, while 429 declined. Foreigners were net sellers of shares worth 776.8 billion won.
Despite recent losses and volatility, the KOSPI has risen more than 62% so far this year, making it one of the best-performing indexes globally.
In money and debt markets, September futures on three-year Treasury bonds gained 0.05 point to 102.86.
The most liquid three-year Korean treasury bond yield fell by 0.1 basis points to 3.858%, while the benchmark 10-year yield rose by 1.9 basis points to 4.332%.
The benchmark KOSPI was down 502.44 points, or 6.90%, at 6,781.97 as of 0113 GMT, more than erasing the previous session's gains. Sharp declines also triggered a "sidecar" trading curb, temporarily halting program trading.
The seven-member monetary policy board at the Bank of Korea voted to raise the seven-day repurchase rate by 25 basis points to 2.75% to shore up the won, which has weakened around 3% against the U.S. dollar this year.
The rate hike, predicted by all but one of 37 economists surveyed in a Reuters poll, aligns the BOK closely with regional neighbour the Bank of Japan, which recently raised its own benchmark rate to a 31-year high.
The won was last quoted at 1,487.6 per dollar on the onshore settlement platform, slightly below the nine-week high of 1,483.9 a dollar touched earlier.
Among equities, the world's leading AI chipmaker SK Hynix tumbled as much as 11.7%, while rival Samsung Electronics fell 8.9%. Battery maker LG Energy Solution climbed 1.79%.
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SK Hynix and Samsung Electronics make up just over half of the benchmark KOSPI index.
Hyundai Motor and sister automaker Kia Corp were down 2.30% and up 0.69%, respectively. Steelmaker POSCO Holdings shed 0.48%, while drugmaker Samsung BioLogics fell 0.51%.
Of the 904 issues traded, 433 shares advanced, while 429 declined. Foreigners were net sellers of shares worth 776.8 billion won.
Despite recent losses and volatility, the KOSPI has risen more than 62% so far this year, making it one of the best-performing indexes globally.
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In money and debt markets, September futures on three-year Treasury bonds gained 0.05 point to 102.86.
The most liquid three-year Korean treasury bond yield fell by 0.1 basis points to 3.858%, while the benchmark 10-year yield rose by 1.9 basis points to 4.332%.
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