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Seoul shares edge down after China's moderate rate cutBy Yonhap
Published : June 20, 2023 - 16:14
South Korean stocks slid for the second day in a row Tuesday, as the smaller-than-expected rate cut by China's central bank dampened market sentiment. The local currency inched up against the US dollar.
The benchmark Korea Composite Stock Price Index slipped 4.59 points, or 0.18 percent, to close at 2,604.91. Trade volume was moderate at 712.8 million shares worth 10.7 trillion won ($8.35 billion), with decliners outstripping gainers 545 to 325.
"The markets had their eyes on whether Beijing will come up with a fresh stimulus to spur consumption. It will have an impact on our stocks in sectors like defense, machineries, steel and chemicals," said Han Ji-young, an analyst at Kiwoom Securities Co.
The People's Bank of China cut the benchmark one-year loan prime rate and the five-year LPR by 0.1 percentage point each, causing disappointment as the reduction in the longer-term rate was smaller than the market projection.
The Chinese central bank's decision reflected limited room for Beijing to take steps to boost its slowing economy amid concerns about rising risks in the local property market.
Market observers will also pay close attention to what US Federal Reserve Chair Jerome Powell says during a congressional testimony slated for Wednesday and Thursday.
Some Fed officials backed the need for further interest rate hikes by the year-end, dashing hopes that the US central bank would end its aggressive rate increases aimed at curbing the runaway inflation.
Wall Street closed Monday for the Juneteenth holiday, celebrating the emancipation of enslaved African Americans.
In Seoul, steel, energy and chemical stocks drove down the shares.
Steel giant POSCO Holdings fell 1.66 percent to 386,000 won and leading chemicals producer LG Chem lost 1.73 percent to 739,000 won.
Top energy company SK Innovation dipped 2.33 percent to 184,100 won.
Tech heavyweight Samsung Electronics was among the gainers, finishing up 0.28 percent at 71,400 won. Chipmaker SK hynix also climbed 1.13 percent to 116,100 won.
Leading shipbuilder HD Hyundai Heavy Industries soared 3.9 percent to 130,400 won.
The local currency ended at 1,280.3 won against the US dollar, up 1.7 won from Monday's close. (Yonhap)
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