[OIL IMPACT] Oil will have less impact on stock markets: report

[THE INVESTOR] Fluctuating crude prices will have limited effect on the stock markets, a local securities firm said in a report on Aug. 3.

According to Yuanta Securities Korea, a sudden plunge in oil prices is unlikely, and that the recent drop is the result of seasonal drop in demand, oil producing nations’ price competition, and over supply.

The company said that although oil prices were the deciding factor for stock markets last year, the situation this year is different saying that inflation is the driving force behind this year’s market trends.

Saying that US personal consumption expenditure price index in July remained similar to that of June despite the 13.9 percent oil price drop seen over the two months, the report claimed that the markets will not be significantly swayed.

By Choi He-suk (cheesuk@heraldcorp.com)