Rally May Stall For South Korea Stock Market

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(RTTNews) – The South Korea stock market has tracked higher in back-to-back sessions, gathering almost 20 points or 0.8 percent along the way. The KOSPI now rests just above the 2,410-point plateau although it may run out of steam on Wednesday.

The global forecast for the Asian markets is negative, with weakness expected especially from the oil and technology stocks ahead of the FOMC rate decision later today. The European and U.S. markets were down and the Asian markets are predicted to follow that lead.

The KOSPI finished modestly higher on Tuesday as gains from the oil and industrial companies were capped by weakness from the financials and a mixed picture from the technology stocks.

For the day, the index added 9.27 points or 0.39 percent to finish at 2,412.96 after trading between 2,395.17 and 2,415.39. Volume was 409.32 million shares worth 6.15 trillion won. There were 442 gainers and 358 decliners.

Among the actives, Shinhan Financial shed 0.69 percent, while KB Financial fell 0.31 percent, Hana Financial dropped 0.97 percent, Samsung Electronics improved 0.98 percent, Samsung SDI advanced 0.90 percent, LG Electronics lost 0.32 percent, SK Hynix gained 0.50 percent, Naver retreated 1.21 percent, LG Chem jumped 1.98 percent, S-Oil climbed 1.43 percent, SK Innovation rallied 2.23 percent, POSCO perked 0.43 percent, SK Telecom strengthened 1.55 percent, KEPCO rose 0.23 percent, Kia Motors was up 0.24 percent and Lotte Chemical and Hyundai Motor were unchanged.

The lead from Wall Street is soft as the major averages opened lower on Tuesday and remained in the red throughout the day, ending near session lows.

The Dow tumbled 228.50 points or 0.71 percent to finish at 31,761.54, while the NASDAQ plunged 220.09 points or 1.87 percent to close at 11,562.57 and the S&P 500 dropped 45.79 points or 1.15 percent to end at 3,921.05.

The weakness on Wall Street also came as traders looked ahead to the Federal Reserve’s monetary policy announcement later today. The Fed is widely expected to announce another 75 basis point rate hike as part of its efforts to combat elevated inflation.

In corporate news, Walmart came under pressure after lowering its guidance for the second quarter and full year due to pricing actions aimed to improve inventory levels. Auto giant General Motors (GM) also moved to the downside after reporting Q2 earnings that missed estimates.

In U.S. economic news, the Commerce Department said new home sales pulled back by more than expected in June. Also, the Conference Board said consumer confidence in the U.S. deteriorated by more than expected in of July.

Crude oil prices fell on Tuesday, weighed by an announcement from the Biden administration about more sales from the national oil reserve to fight inflation at the pump. The dollar’s rebound from recent losses also contributed the drop in oil prices. West Texas Intermediate Crude oil futures for September ended lower by $1.72 or 1.8 percent at $94.98 a barrel.