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Seoul stocks crash to yearly low amid deepening recession fears

16:05 September 23, 2022

SEOUL, Sept. 23 (Yonhap) -- South Korean stocks dropped to the lowest level this year on Friday on mounting fears that the Federal Reserve's aggressive rate hikes would further exacerbate a global recession. The local currency went up against the greenback.

The benchmark Korea Composite Stock Price Index (KOSPI) fell by 42.31 points, or 1.81 percent, to 2,290, extending its losing streak to a third session and marking the lowest point so far this year.

Trading volume was moderate at 438.3 million shares worth 7.3 trillion won (US$ 5.2 billion), with decliners outnumbering gainers 796 to 110.

The market opened lower, taking a cue from overnight losses on Wall Street amid concerns that the Fed's aggressive monetary tightening would throw the global economy into a deep recession.

Earlier this week, the Fed raised its target interest rate by 75 basis points for a third straight time.

"Today's decline is attributed to lack of buying interest amid the weakening Korean won, soaring bond yields," Seo Sang-yeong, an analyst from Mirae Asset Securities, said.

Seo noted that investors are positioned to digest a series of key economic data from major economies next week.

"The U.S. Consumer Confidence Index is due for Tuesday, the final U.S. GDP for Thursday and other indexes from China and Europe will come out on Friday. Their results can either fan or cool off recession woes."

Foreign and institutional investors sold shares worth a combined 441.2 billion won, while individual investors snapped up a net 431.1 billion won worth of stocks.

Most large cap shares were bearish, led by losses in the battery, auto and tech stocks.

Market bellwether Samsung Electronics inched up 0.18 percent to end at 54,500 won, while rival SK hynix dipped 2,91 percent to close at 83,500 won.

Top automaker Hyundai Motor lost 1.55 percent to 190,500 won, and its smaller affiliate Kia dropped 2.02 percent to 77,600 won.

Battery makers fell sharply. Top player LG Energy Solution shed 5.73 percent to 460,500 won, while its smaller local rival Samsung SDI lost 3.02 percent to 610,000 won.

The local currency ended at 1,409.3 won against the U.S. dollar, up 0.4 won from Thursday's close.



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