South Korea Stock Market May Give Up Support At 2,700 Points

(RTTNews) – The South Korea stock market has finished lower in back-to-back sessions, sinking almost 40 points or 1.4 percent along the way. The KOSPI now rests just beneath the 2,705-point plateau and it’s in line for continued consolidation on Wednesday.

The global forecast for the Asian markets is negative on geopolitical concerns over escalation of conflict between Russia and Ukraine. The European and U.S. markets were down and the Asian markets are tipped to follow a similar path.

The KOSPI finished sharply lower on Tuesday following losses from the financials, industrials and technology stocks.

For the day, the index dropped 37.01 points or 1.35 percent to finish at 2,706.79 after trading between 2,690.09 and 2,721.84. Volume was 639 million shares worth 10.4 trillion won. There were 778 decliners and 101 gainers.

Among the actives, Shinhan Financial declined 1.45 percent, while KB Financial slumped 1.11 percent, Hana Financial fell 0.39 percent, Samsung Electronics skidded 1.08 percent, LG Electronics stumbled 2.41 percent, SK Hynix retreated 1.15 percent, Naver tumbled 1.57 percent, LG Chem plunged 4.22 percent, Lotte Chemical and S-Oil both dropped 1.09 percent, SK Innovation plummeted 3.60 percent, POSCO sank 0.89 percent, SK Telecom added 0.55 percent, KEPCO shed 0.66 percent, Hyundai Motor tanked 1.89 percent and Kia Motors lost 1.52 percent.

The lead from Wall Street suggests consolidation as the major averages opened slightly lower on Tuesday but saw losses accelerate as the day progressed, ending firmly in the red.

The Dow plunged 482.57 points or 1.42 percent to finish at 33,596.61, while the NASDAQ tumbled 166.55 points or 1.23 percent to end at 13,381.52 and the S&P 500 dropped 44.11 points or 1.01 percent to close at 4,304.76.

The weakness on Wall Street came after Russian President Vladimir Putin recognized two Ukrainian separatist regions – Donetsk and Luhansk – as sovereign states and sent troops into those territories as “peacekeepers.”

Describing the latest actions by Russia as the beginning of an invasion of Ukraine, U.S. President Joe Biden announced the first tranche of U.S. sanctions on two large Russian financial institutions, VEB and Russia’s military bank, and Russia’s sovereign debt, as well as Russian elites and their family members.

The U.K. also announced a first tranche of sanctions on Russia, targeting five Russian banks and three “very high net worth” individuals.

Oil prices moved up sharply Tuesday on concerns over supplies following Russia’s aggressive move into Ukraine. It is feared that a full-blown conflict in Ukraine could cause major disruption to crude supplies. West Texas Intermediate Crude oil futures for April ended higher by $1.70 or 1.9 percent at $91.91 a barrel.

Closer to home, the Bank of Korea said this morning that business conditions strengthened in February, with a business survey index score of 91 – up from 90 in January. The outlook for the following month improved from 90 to 93.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Jinggo B Danuarta

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