South Korea’s Kospi falls for fifth day on worries about recession

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The main index of the Seoul Stock Exchange, the Kospi, fell 0.19% on Wednesday, its fifth straight day of decline, on concerns about a possible global recession following the tightening of the U.S. central bank’s rhetoric on rates and monetary tightening in Japan.

The Kospi fell 4.34 points, to stand at 2,328.95 units, in a session in which 4.95 trillion yen (about 35,300 million euros) moved.

Instead, the technology stock index Kosdaq It rose 0.37% or 2.57 points to 705.70.

South Korean investors opted for caution after the recent comments of the US Federal Reserve (Fed) in which it pointed to a higher than expected rate hike, and after the Bank of Japan (BoJ) extended the margin of yields on the 10-year bond, from +/-0.25% to +/-0.5%.

This monetary tightening in the world’s third-largest economy, reluctant to raise rates, has fueled speculation that Japan’s central bank opted next year to follow in the footsteps of its counterparts in the US and Europe, renewing concerns about a potential recession.

Companies in the technology and automotive sectors reaped the biggest setbacks of the day.

The Samsung Electronics Group (KS:005930), local benchmark, was down 1%, and the country’s second-largest chipmaker, SK hynix, fell by 0.4%.

Hyundai Motor lost 0,6 %.

Among the companies that posted profits were Korean Air, which added 0.4%; SK Innovation refinery, which rose 0.3%; and aircraft manufacturer Korea Aerospace Industries, which rose 1.6%.

The local currency, the won, gained 3.9 against the U.S. dollar, which was trading at 1,285.70 won at the close of the session.

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