Seoul, Sep 11: South Korea’s benchmark KOSPI index closed sharply lower on Friday as rising crude oil prices and renewed tensions in the Middle East increased concerns about inflation and the global interest-rate outlook.
The KOSPI opened 3.29 per cent lower at 6,802.50 before recovering some of its losses during the day. It eventually closed at 6,909.91, down 1.76 per cent from the previous session.
Foreign investors remained major sellers, offloading a net 2.29 trillion won ($1.70 billion) worth of shares. Institutional investors also sold a net 1.22 trillion won, while retail investors bought shares worth 1.87 trillion won.
Major technology stocks were also under pressure. SK hynix declined 2.21 per cent to 1.812 million won, while Samsung Electronics fell 3.35 per cent to 259,500 won.
The decline came as international oil prices moved above $100 a barrel amid renewed geopolitical uncertainty in the Middle East. Higher energy costs have raised concerns that inflation could remain elevated and put additional pressure on businesses and consumers.
Investor sentiment was further affected by higher US Treasury yields. The 10-year US Treasury yield climbed 12 basis points to 4.96 per cent, approaching the key 5 per cent level.
The latest US producer price data also added to inflation concerns, with producer prices rising 5.4 per cent in August from a year earlier, slightly above market expectations.
Investors are now closely watching upcoming US consumer inflation data for further clues about the direction of interest rates. Persistent inflation could limit the scope for monetary easing and keep borrowing costs higher for longer.
The combination of expensive oil, rising bond yields and geopolitical uncertainty has made investors more cautious, particularly toward technology and other growth-sensitive stocks.
Market participants are expected to continue tracking crude oil prices, US inflation data, bond yields and developments in the Middle East as they assess the outlook for Asian equities and global markets.
