Seoul stocks dip almost 3 pct on recession fears; Korean won at 13-year low
Published : Jun 22, 2022 - 16:12
Updated : Jun 23, 2022 - 09:43
An electronic board showing the Korea Composite Stock Price Index (Kospi) at a dealing room of the Hana Bank headquarters in Seoul on Wednesday. (Yonhap)

South Korean stocks fell again, shedding almost 3 percent Wednesday as recession woes made investors avoid risky assets amid hawkish monetary policy in major economies. The local currency fell to the lowest point against the US dollar in 13 years.

The Korea Composite Stock Price Index (KOSPI) dropped 66.12 points, or 2.74 percent, to close at 2,342.81.

Trading volume was moderate at 520.87 million shares worth 8.50 trillion won ($6.54 billion), with decliners far outpacing gainers by 870 to 40.

Institutions and foreign investors offloaded a net 85.3 billion won and 320.6 won worth of shares, respectively, while retail investors bought a net 376.7 billion won worth of shares.

The market got off to a good start, buoyed by Wall Street's gains. But it fell into negative territory, as aggressive rate hikes and fears about economic downturn weighed down investor sentiment.

"Investor sentiment is very negative" Seo Sang-young, an analyst at Mirae Asset Securities Co. said. "Appetite for risky assets waned on recession fears."

Overnight, Wall Street made a comeback following a brutal week in the wake of the US Federal Reserve's rate hike of 0.75 percent, its steepest increase since 1994, to tame inflation.

Seoul shares slumped across the board with tech shares leading the losses.

Market bellwether Samsung Electronics lost 1.54 percent to a yearly low of 57,600 won, while No. 2 chipmaker SK hynix retreated 3.15 percent to 92,200 won.

Major battery maker LG Energy Solution declined 2.91 percent to 401,000 won and chemical giant LG Chem shed 2.64 percent to 553,000 won.

Hyundai Motor decreased 0.58 percent to close at 171,500 won and its smaller affiliate Kia lost 1.16 percent to 76,400 won.

Major bio shares ended mixed. Samsung Biologics inched down 0.49 percent to 817,000 won, while Celltrion went up 1.30 percent to 156,000 won.

The local currency ended at 1,297.30 won against the US dollar, down 3.7 won from the previous session's close and the lowest value since July 2009. (Yonhap)