Stocks finish higher for third straight day after solid U.S. inflation data

Stocks closed higher Thursday for a third straight day as investors digested solid U.S. inflation data as a sign of the U.S. Federal Reserve terminating its rate hike campaign. The won sharply rose against the dollar.

Screens in Hana Bank's trading room in central Seoul show the Kospi closing at 2,591.23 points on Thursday, up 0.64 percent, or 16.51 points, from the previous trading session. [YONHAP]

Stocks closed higher Thursday for a third straight day as investors digested solid U.S. inflation data as a sign of the U.S. Federal Reserve terminating its rate hike campaign. The won sharply rose against the dollar.

The benchmark Kospi climbed 16.51 points, or 0.64 percent, to finish at 2,591.23.

Trading volume was moderate at 573.79 million shares worth 13.1 trillion won ($10.2 billion), with gainers outpacing decliners 469 to 399.

Institutions and foreigners bought a combined 716 billion won worth of stocks, offsetting individuals' stock selling valued at 719 billion won.

Overnight, the Dow Jones Industrial Average advanced 0.3 percent, and the tech-heavy Nasdaq Composite moved up 1.2 percent.

The U.S. consumer price index, a key inflation gauge, rose 3 percent in June from a year earlier, the smallest increase since March 2021.

The sharp slowdown in U.S. inflation increases the likelihood of the U.S. central bank ending its aggressive monetary tightening policy, analysts said.

Earlier in the day, the Bank of Korea also kept its key rate at 3.5 percent due to an economic slowdown and easing inflation.

In Seoul, large-cap stocks were mixed.

Samsung Electronics closed flat at 71,900 won, and SK hynix lost 1.13 percent to 114,100 won.

LG Energy Solution was up 1.5 percent to 542,000 won, and Samsung SDI jumped 3.77 percent to 715,000 won.

LG Chem grew 2.6 percent to 670,000 won, and Posco Holdings rose 3.35 percent to 431,500 won.

Hyundai Motor stayed unchanged at 203,500 won, while Kia shed 1.02 percent to 87,500 won.

Korean Air Lines fell 1.2 percent to 25,550 won, Korea Aerospace Industries declined 1.3 percent to 54,500 won and AmorePacific lost 0.6 percent to 103,500 won.

The local currency closed at 1,274 won against the dollar, down 14.7 won from the previous session's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds dropped 10.1 basis points to 3.600 percent, and the yield on the benchmark 10-year government bonds retreated 11.2 basis points to 3.860 percent.

BY SOHN DONG-JOO, YONHAP [sohn.dongjoo@joongang.co.kr]