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Seoul shares end higher on Fed's rate-hike pause hopes

June 5, 2023 - 16:13 By Yonhap
An electronic board showing the Korea Composite Stock Price Index at a dealing room of the Hana Bank headquarters in Seoul on Monday. (Yonhap)

Seoul shares ended higher Monday amid hopes that the US Federal Reserve may not raise interest rates this month due to signs of slackening in the US labor market. The Korean won fell against the US dollar.

The benchmark Korea Composite Stock Price Index (Kospi) rose 14.05 points, or 0.54 percent, to close at 2,615.41. The main index continued to close at above 2,600 after surpassing the 2,600 level on Friday for the first time since June 9, 2022.

Trading volume was moderate at 537.16 million shares worth 8.43 trillion won ($6.4 billion), with gainers outpacing decliners 655 to 209.

On June 2, the Dow Jones Industrial Average jumped 2.1 percent to 33,762.76, and the Nasdaq Composite gained 1 percent to 13,240.77.

The May US jobs report cemented bets for the Fed's rate-hike pause this month as it hinted there are signs of the labor market slackening despite an increase in hiring, analysts said.

Labor market slack is the unmet demand for employment within a given population.

"Profit taking in tech stocks kept the Kospi from rising further in today's session. Now all eyes are on whether the Fed will hold rates steady at next week's meeting," Park Hee-cheol, an analyst at Mirae Asset Securities Co., said over the phone.

Institutions bought a net 452.66 billion won worth of stocks, offsetting foreigners and individuals' combined stock selling valued at 457 billion won.

In Seoul, auto, airline and energy stocks led gains.

Top carmaker Hyundai Motor Co. rose 0.8 percent to 201,000 won, national flag carrier Korean Air Co. climbed 1.4 percent to 22,050 won, leading chemical firm LG Chem Ltd. added 0.3 percent to 723,000 won, and leading refiner SK Innovation Co. was up 0.9 percent to 199,700 won.

Among decliners, market bellwether Samsung Electronics Co. fell 0.7 percent to 71,700 won, No. 2 chipmaker SK hynix Inc. declined 1.5 percent to 108,700 won, and the country's sole aircraft manufacturer Korea Aerospace Industries Co. shed 1.3 percent to 53,100 won.

The local currency ended at 1,308.10 won against the US dollar, down 2.4 won from the previous session's close. (Yonhap)