The South Korean stock market concluded its two-day winning streak on Tuesday, during which it surged by over 55 points or 2 percent. The KOSPI index is now slightly above the 2,735-point mark and is likely to experience additional declines on Wednesday.
The global outlook for Asian markets is mixed to lower, with significant losses expected in the technology sector. Both European and U.S. markets had mixed to lower performances, putting Asian exchanges under pressure at the opening.
The KOSPI fell sharply on Tuesday, impacted by declines in the energy, technology, and industrial sectors, while the financials showed mixed results.
The index dropped 27.34 points or 0.99 percent to close at 2,738.19. The trading volume was 376.4 million shares with a total value of 9.9 trillion won. The market saw 664 decliners against 225 gainers.
Key movements included Shinhan Financial falling 1.98 percent, KB Financial declining 1.65 percent, and Hana Financial rallying 1.59 percent. Samsung Electronics slipped 0.25 percent, Samsung SDI slumped 1.49 percent, and LG Electronics dropped 1.53 percent. SK Hynix plunged 3.43 percent, Naver and LG Chem both fell 0.97 percent, while Lotte Chemical sank 0.90 percent. S-Oil declined 2.63 percent, SK Innovation dropped 0.67 percent, POSCO fell 0.96 percent, SK Telecom improved by 0.74 percent, KEPCO declined 0.31 percent, Hyundai Mobis plummeted 2.63 percent, Hyundai Motor tumbled 2.15 percent, and Kia Motors retreated 1.85 percent.
Wall Street provided a mostly negative lead as major indices opened higher but quickly lost ground, resulting in mixed finishes.
The Dow Jones Industrial Average rose 203.40 points or 0.50 percent to 40,743.33, while the NASDAQ fell 222.79 points or 1.28 percent to 17,147.42, and the S&P 500 declined 27.10 points or 0.50 percent to 5,436.44.
The mixed results on Wall Street were partly due to anticipation of the Federal Reserve's monetary policy announcement. Although the Fed is expected to keep interest rates unchanged, the accompanying statement could greatly influence expectations for the Fed's next meeting in September.
The NASDAQ’s steep drop was driven by pressure on tech stocks, particularly Nvidia (NVDA), Microsoft (MSFT), and Advanced Micro Devices (AMD). Semiconductor stocks were notably hit, leading to a 3.9 percent decline in the Philadelphia Semiconductor Index, which fell to its lowest closing level in over two months.
Oil prices fell on Tuesday amid ongoing demand concerns and in anticipation of the Federal Reserve's announcement and weekly inventory data. West Texas Intermediate crude oil futures for September closed at $74.73 a barrel, down $1.08 or 1.42 percent.
In local economic news, South Korea is set to release June data for industrial production and retail sales later today. Production is expected to decline by 0.7 percent month-on-month and rise by 2.3 percent year-on-year, following a 1.2 percent month-on-month drop and a 3.5 percent year-on-year increase in May. Retail sales dropped 0.2 percent on a monthly basis in May.
