Kospi closes lower Tuesday ahead of U.S. inflation data announcement

Stocks closed lower Tuesday as investors eye the U.S. inflation data announcement on Wednesday for clues on the future direction of the Federal Reserve's interest rate policy. The won rose against the dollar.

Screens in Hana Bank's trading room in central Seoul show the Kospi closing at 2,536.58 points on Tuesday, down 0.79 percent, or 20.30 points, from the previous trading session. [YONHAP]

Stocks closed lower Tuesday as investors eye the U.S. inflation data announcement on Wednesday for clues on the future direction of the Federal Reserve's interest rate policy. The won rose against the dollar.

The benchmark Kospi retreated 20.30 points, or 0.79 percent, to finish at 2,536.58.

Trading volume was light at 354.5 million shares worth 8.78 trillion won ($6.61 billion), with decliners outstripping gainers 639 to 230.

"The stock market is not showing a clear direction as investor sentiment turned more cautious ahead of the U.S. consumer price index data release," Shinhan Investment & Securities analyst Noh Dong-gil said.

"The overnight Wall Street rally wasn't echoed in Korea since the gain was more of a rebound from corporate news than from macro factors," Noh said.

The United States is set to release the consumer price index for August on Wednesday, with the reading on producer prices to be released the following day.

The upcoming data is expected to provide clues about the Fed's tightening policy before the monetary policy meeting slated for Sept. 19 to 20.

All three U.S. stock indexes closed higher Monday, with Tesla spiking 10 percent after a Morgan Stanley report predicted the carmaker's market value could grow by nearly $600 billion with its Dojo supercomputer designed for self-driving.

In Seoul, large-cap stocks led the decline.

Samsung Electronics slipped 0.4 percent to 70,500 won and LG Energy Solution fell 1.7 percent to 499,500 won.

Posco Holdings dipped 4.2 percent to 546,000 won, and Posco Future M lost 2.6 percent to 397,000 won. SK Innovation dropped 0.54 percent to 167,000 won.

Among gainers, Hyundai Motor rose 0.4 percent to 186,200 won and Hyundai Mobis advanced 0.7 percent to 232,000 won.

Naver jumped 3.8 percent to 219,500 won.

The local currency ended at 1,327.8 won against the dollar, down 3.3 won from Monday's close.

Bond prices, which move inversely to yields, closed mixed. The yield on three-year government bonds shed 0.6 basis points to 3.9 percent, and the yield on the benchmark 10-year U.S. government bonds added 1.9 basis points to 4.3 percent.

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