Seoul, March 19 (IANS) South Korean shares traded nearly 2 per cent lower on Thursday on heightened market volatility sparked by escalating tensions in the Middle East and uncertainties surrounding the United States’ monetary policy direction, despite its rate freeze decision.
The benchmark Korea Composite Stock Price Index (KOSPI) dropped 112.91 points, or 1.19 percent, to 5,812.12 as of 11:20 a.m.
Overnight, the Dow Jones Industrial Average dipped 1.63 percent, while the tech-heavy Nasdaq Composite slid 1.46 percent and the S&P 500 pulled back 1.36 percent, reports Yonhap news agency.
Investors’ risk appetite was sapped as Israel attacked Iran’s largest gas field South Pars and Iran hit back with a strike on a major liquefied natural gas site in Qatar, driving up global oil prices again.
U.S. Federal Reserve Chair Jerome Powell’s remarks after the Fed’s decision to maintain its policy rate in the 3.5-3.75 percent range also dragged down market sentiment.
At a press conference, Fed Chair Jerome Powell said the surge in oil prices has increased inflationary pressures, signaling a cautious stance on the timing of further rate cuts.
In Seoul, market top-cap Samsung Electronics lost 2.64 percent, and its chipmaking rival SK hynix slipped 3.12 percent.
Auto giant Hyundai Motor shed 3.3 percent, and its sister Kia went down 1.6 percent.
Artificial intelligence (AI) investment firm SK Square dipped 2.7 percent, and leading battery maker LG Energy Solution decreased 1.69 percent.
Major defence firm Hanwha Aerospace dropped 1.22 percent, and leading shipbuilder HD Hyundai Heavy contracted 2.54 percent.
Power plant manufacturer Doosan Enerbility was among the few gainers, rising 0.84 percent.
Financial shares also gained ground, with KB Financial up 1.1 percent and Shinhan Financial up 0.42 percent.
The Korean won was trading at 1,496.9 won against the U.S. dollar at 11:20 a.m., down 13.8 won from the previous session. The won initially fell past the 1,500 won level against the dollar at the opening bell.
—IANS
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