Kospi dips below 2,400, won falls after Wall Street swing

Hana Bank dealing room on Mar. 10. [Photo by Yonhap]

Seoul stocks opened lower on Friday, with the benchmark Kospi dipping below the 2,400 mark for the first time in 8 trading sessions to track overnight falls on the Wall Street amid concerns about monetary tightening ahead of the release of the U.S. employment report for February.

The Kospi fell 1.25 percent to 2,388.9 as of midday, dipping below the 2,400 mark for the first time in 8 sessions during the day after falling to 2,383.76 on Feb. 27.

Individual investors net purchased 114 billion won ($85.8 million) in shares while foreigners and institutions net sold 73.3 billion won and 43.8 billion won, respectively.

The won/dollar exchange rate started at 1,325.5 won, up 3.3 won from the previous day’s close but has since fluctuated in the low 1,320 won range.

Overnight, Wall Street stocks fell with a steep decline in the banking sector that froze market sentiment.

The Dow Jones Industrial Average was down 1.66 percent, the S&P 500 Index 1.85 percent, and the tech-heavy Nasdaq Composite Index 2.05 percent as concerns rose ahead of the release of the U.S. February employment report.

Market uncertainty also increased as U.S. President Joe Biden unveiled the 2024 fiscal year budget, which included corporate tax increases and the introduction of a wealth tax.

“The U.S. stock market declined … and this is putting pressure on the Korean market,” said Seo Sang-young, an analyst at Mirae Asset Securities Co. “But the index decline today will likely be limited.”

Shares of most of the top market cap companies lost ground, including Samsung Electronics Co. (-1.16 percent), LG Energy Solution Ltd. (-0.36 percent), SK hynix Inc. (-2.22 percent), and Samsung Biologics Co. (-0.91 percent).

By industry sector, transportation and warehousing lost 1.58 percent, non-metallic minerals 1.43 percent, securities 1.40 percent, and financial 1.34 percent. Only the construction industry saw an increase in the morning.

The secondary Kosdaq is trading at 790.37, down 2.33 percent from the previous day as of midday, after starting the day at 796.57. It is the first time in five trading days for the index to go below the 800 mark during the day.