The South Korean stock market ended its four-day losing streak on Tuesday, during which it had fallen by nearly 140 points, equating to a 5.6% drop. The KOSPI index closed slightly below the 2,420 mark, though there are expectations of potential consolidation on Wednesday.
The outlook for Asian markets appears bleak, as weaknesses in the computer, semiconductor, and housing sectors are anticipated to exert downward pressure. Following declines in both European and U.S. markets, it's expected that Asian markets will similarly reflect this negative trend.
On Tuesday, the KOSPI index surged significantly, propelled by broad-based bargain hunting following recent heavy sell-offs, particularly in the chemicals and industrials sectors. The index rose by 57.26 points, or 2.43%, concluding the day at 2,417.84, with trade ranging between 2,384.51 and 2,419.06. The day's trading volume reached 587 million shares, valued at 9.05 trillion won, with 873 stocks advancing and 48 declining.
In terms of individual performance, Shinhan Financial slipped 1.48%, whereas KB Financial gained 0.60%, and Hana Financial increased 0.17%. Samsung Electronics experienced a 1.12% rise, Samsung SDI soared 5.43%, LG Electronics grew 1.32%, and SK Hynix improved by 0.89%. Naver rallied 3.72%, LG Chem jumped 8.72%, Lotte Chemical surged 10.46%, SK Innovation climbed 8.43%, and POSCO Holdings increased by 6.90%. On the other hand, SK Telecom fell 1.75%, while KEPCO saw a 2.39% gain, Hyundai Mobis rose 2.26%, Hyundai Motor accelerated 4.73%, and Kia Motors advanced 4.13%.
Wall Street sent a subdued signal as major indices stayed relatively flat most of the session on Tuesday, eventually dropping into negative territory later in the day. The Dow Jones Industrial Average fell by 154.10 points or 0.35%, settling at 44,247.83. Meanwhile, the NASDAQ decreased by 49.45 points or 0.25%, ending at 19,687.24, and the S&P 500 declined by 17.94 points or 0.30%, closing at 6,034.91.
This downturn on Wall Street is attributed to traders capitalizing on recent market strengths, ahead of the Labor Department's impending consumer price inflation report. Although there's widespread expectation for the Federal Reserve to reduce interest rates by 25 basis points next week, the forthcoming data could influence projections for future rate adjustments by the central bank.
Currently, the CME Group's FedWatch Tool indicates an 86.1% likelihood of a quarter-point rate cut by the Fed next week, accompanied by a 69.1% likelihood of the rates remaining unchanged by late January.
On the commodities front, oil futures ended higher on Tuesday amid optimism that demand from China will increase following recent economic stimulus measures from the Chinese government. West Texas Intermediate crude oil futures for January delivery rose by $0.22, or 0.32%, settling at $68.59 per barrel.
