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Seoul shares dip over 1.5% amid woes over Fed's hawkish move; Korean won down by most in over 1 yr

An electronic board showing the Korea Composite Stock Price Index (Kospi) at a dealing room of the Hana Bank headquarters in Seoul on Tuesday. (Yonhap)
An electronic board showing the Korea Composite Stock Price Index (Kospi) at a dealing room of the Hana Bank headquarters in Seoul on Tuesday. (Yonhap)

Seoul shares nosedived by over 1.5 percent Tuesday amid concerns about fast-growing inflation pressure that may strengthen monetary tightening in the United States and other major economies. The Korean won steeply fell against the US dollar.

The benchmark Korea Composite Stock Price Index 44.31 points, or 1.66 percent, to close at 2,626.34 points.

Trading volume was moderate at about 517 million shares worth some 8.8 trillion won ($7 billion), with losers outnumbering gainers 730 to 163.

Institutions dumped a net 823 billion won and foreigners sold 205 billion won, while retail investors bought 992 billion won.

Investors remained wary of the US Fed's hawkish stance, which has triggered a sharp rise in US Treasury fields.

"The estimate-beating US job data for May and other factors added to the possibilities of aggressive monetary tightening by the Fed, putting more upward pressure on the US dollar. The volatility in the FX market increased sell-offs in the futures market," said Shinhan Investment researcher Choi Yoo-joon.

Most large caps finished lower in Seoul.

Market bellwether Samsung Electronics lost 1.95 percent to 65,500 won, and the country's largest chemical company, LG Chem, shed 4.96 percent to 556,000 won.

Leading automaker Hyundai Motor dropped 1.87 percent to 183,500 won, and No. 2 chipmaker SK hynix declined 2.8 percent to 104,000 won. Internet portal giant Naver retreated 3.3 percent to 278,000 won.

Among gainers, gaming firm Krafton jumped 6.13 percent to 268,500 won, with battery maker SK Innovation adding 4.88 percent to 236,500 won.

The local currency closed at 1,257.7 won against the US dollar, plunging 15 won from the previous session's close, the sharpest fall in almost 13 months, as demand for risky assets waned. (Yonhap)

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