Stocks decline 1.5 percent as technology shares fall

Stocks fell Wednesday, with tech heavyweight Samsung Electronics dipping 1.5 percent, dented by dismal earnings projections by big U.S. tech firms, like Micron Technology, that pointed to a further slowdown in global chip demand.

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,480.88 points on Wednesday, down 22.58 points, or 0.90 percent, from the previous trading day. [YONHAP]

Stocks fell Wednesday, with tech heavyweight Samsung Electronics dipping 1.5 percent, dented by dismal earnings projections by big U.S. tech firms, like Micron Technology, that pointed to a further slowdown in global chip demand.

Analysts say investor sentiment remains cautious with eyes on U.S. consumer prices, due to be announced Wednesday, as it will provide a clue as to how fast the U.S. Federal Reserve will push for monetary tightening going forward.

The Kospi retreated 22.58 points, or 0.90 percent, to 2,480.88. Trading volume was moderate at 471.7 million shares worth 8.9 trillion won ($6.8 billion) with decliners outpacing gainers 567 to 301.

Institutions offloaded a net 203.1 billion won worth of stocks and foreigners a net 104.9 billion won, while retail investors bought a net 261.9 billion won.

"The waning chip demand is not getting any better, as opposed to how we're seeing improvement from the supply side," said Han Ji-young, an analyst at Kiwoom Securities.

"Rather than the supply side, high inflation and the U.S. rate hike pressure seem to be causing the demand to slow," Han said, adding stocks will move tepidly for the time being, with all eyes on the July U.S. consumer prices.

In Seoul, Samsung Electronics fell1.5 percent to 59,100 won and SK hynix slumped 3.47 percent to 458,000 won. Hyundai Motor fell 0.52 percent to 192,500 won, and LG Chem fell 3.43 percent to 648,000 won.

Naver dropped 1.13 percent to 262,000 won, with Kakao dipping 3.49 percent to 80,300 won.

Construction companies and steelmakers advanced. Hyundai Engineering & Construction jumped 7.54 percent to 46,350 won, and Posco Holdings rose 1.02 percent to 248,500 won.

The local currency ended at 1,310.40 won against the dollar, up 5.8 won from Tuesday's close.

The Kosdaq lost 13.38 points, or 1.60 percent, to close at 820.27 points.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds gained 2.4 basis points to 3.159 percent, and the yield on the 10-year government bond advanced 2.7 basis points to 2.78 percent.

BY CHO JUNG-WOO, YONHAP [cho.jungwoo1@joongang.co.kr]