Kospi breaks 3-day winning streak even as rate hopes linger

The Kospi closed lower Thursday to break a three-day winning streak while hopes for a pause in U.S. rate hikes in September linger. The benchmark bourse fell 4.95 points, or 0.19 percent, to close at 2,556.27.

Screens in Hana Bank's trading room in central Seoul show the Kospi closing at 2,556.27 points on Thursday, down 0.19 percent, or 4.95 points, from the previous trading session. [YONHAP]

The Kospi closed lower Thursday to break a three-day winning streak while hopes for a pause in U.S. rate hikes in September linger. The won rose against the dollar.

The benchmark index fell 4.95 points, or 0.19 percent, to close at 2,556.27.

Trading volume was moderate at 461.5 million shares worth 10.8 trillion won ($8.16 billion), with decliners outnumbering gainers 515 to 352.

Foreigners unloaded a net 213.1 billion won, while institutions bought a net 159.3 billion won and individuals scooped up 13.3 billion won.

"Private sector hiring and payrolls show signs of a slowdown in U.S. employment. That's the data we need at a time when the Fed is uncomfortable about further tightening," Kiwoom Securities analyst Han Ji-young said.

The U.S. economy grew 2.1 percent on year in the second quarter, falling short of a 2.4 percent estimate.

Payrolls in the private sector in August slowed more than expected to 177,000, signaling a moderate labor market.

The latest economic data reinforced hopes that the U.S. Federal Reserve will keep its rate steady at the upcoming policy meeting in September.

The adjustment of the asset portfolio in the Morgan Stanley Capital International (MSCI) Korea Index, a measurement of performance, also affected the Kospi's movement, Han noted.

EcoPro, Hanwha Ocean, JYP Entertainment and Hanmi Semiconductor were added to the MSCI Korea Index, while CJ and E-Mart were ejected.

"Rebalancing usually incurs a technical buying and selling of foreign funds that follow the index," Han added.

In Seoul, large-cap bio and IT stocks drove the bourse down.

Samsung Electronics shed 0.3 percent to 66,900 won, while SK hynix jumped 2 percent to 121,800 won.

Samsung Biologics sank 2.4 percent to 737,000 won and Celltrion dropped 2.4 percent to 143,900 won. Naver lost 1.4 percent to 214,500 won.

The local currency ended at 1,321.80 won against the dollar, down 1.6 won from Wednesday's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds lost 2.3 basis points to 3.7 percent, and the yield on the benchmark 10-year government bonds retreated 0.6 basis points to 4.1 percent.

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