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Seoul shares spike nearly 2% on export recovery despite dashed hope for Fed's early rate cuts

Feb. 1, 2024 - 16:09 By Yonhap
An electronic board showing the Korea Composite Stock Price Index at a dealing room of the Hana Bank headquarters in Seoul on Thursday. (Yonhap)

South Korean stocks rose by almost 2 percent Thursday despite overnight Wall Street losses, with techs and autos climbing as the nation's exports rose for the fourth month. The Korean won rose against the US dollar.

The benchmark Korea Composite Stock Price Index climbed 45.37 points, or 1.82 percent, to 2,542.46.

Trade volume was heavy at 741.3 million shares worth 13.3 trillion won ($9.98 billion), with winners outpacing losers 668 to 239.

South Korea's exports moved up for the fourth consecutive month in January to reach $54.6 billion, according to data compiled by the Ministry of Trade, Industry and Energy.

Semiconductor shipments, in particular, shot up 56.2 percent on-year, growing for three consecutive months and marking the sharpest increase since December 2017.

Overnight, the US Federal Reserve held its benchmark lending rate steady for the fourth consecutive time. After the two-day Federal Open Market Committee meeting, Fed Chair Jerome Powell said a rate cut in March is "probably not the most likely case."

The S&P 500 dropped 1.6 percent, marking its worst daily loss since September. The Dow Jones Industrial Average and the Nasdaq composite also fell 0.80 percent and 2.2 percent, respectively.

Lee Jae-seon, an analyst at Hyundai Motor Securities, said, "the Kospi appears to have gained ground from the positive January export figures."

He said market observers see no change in the anticipation of a future rate cut by the Fed, despite Powell's comments dismissing the possibility of an interest rate cut next month.

In Seoul, tech and financial shares led the overall gains, with market heavyweight Samsung Electronics adding 1.24 percent to close at 73,600 won and KB Financial soaring 8.30 percent to 61,300 won.

Automakers also enjoyed brisk trading, with industry leaders Hyundai Motor and Kia climbing 6.89 percent and 3.30 percent to 208,000 won and 106,300 won, respectively.

Airlines also advanced after Korean Air and Asiana Airlines received an approval from Japan's antitrust regulator over their proposed merger. Korean Air added 0.89 percent to close at 22,700 won.

Bio shares, however, lost ground, with Samsung Biologics dropping 1.31 percent to 829,000 won and Celltrion shedding 0.56 percent to close at 178,700 won.

The local currency closed at 1,331.80 won against the greenback, up 2.80 won from the previous session's close. (Yonhap)