Kospi Holds 5,800 Line After US-Iran Talks Collapse; Samsung Electronics Falls, SK Hynix Gains

Source

Korea Economic Daily

Summary

The report said the Kospi barely held the 5,800 level as the collapse of US-Iran war-ending talks, conflict over the Strait of Hormuz, and a surge in oil prices weighed on sentiment.
Amid net selling by foreigners and institutions, retail investors countered with net buying of 1.007 trillion won, while Samsung Electronics fell and SK Hynix rose.
The report said investor sentiment diverged across sectors and markets, with gains in power equipment shares including LS ELECTRIC, as well as rises in the Kosdaq index and the won-dollar exchange rate.

Forecast Trend Report by Period

Kosdaq Turns Higher During Session

Won-Dollar Exchange Rate Edges Up

South Korea’s Kospi barely held above the 5,800 level on April 13 as investor sentiment weakened after US-Iran talks to end the war collapsed.

The Kospi closed at 5,808.62, down 50.25 points, or 0.86%, from the previous session. The benchmark at one point fell to the 5,730 range, but pared losses on retail buying to finish above 5,800.

The decline came as tensions flared over control of the Strait of Hormuz following the breakdown in US-Iran negotiations.

US Central Command said it would begin enforcing a blockade on all maritime traffic entering or leaving Iranian ports at 10 a.m. Eastern Time on April 13 under a presidential proclamation.

CENTCOM said the blockade would apply without discrimination to ships of all countries traveling to and from all Iranian ports in the Persian Gulf and the Gulf of Oman. It added that freedom of navigation through the Strait of Hormuz for vessels traveling to and from non-Iranian ports would not be obstructed.

Oil prices surged. West Texas Intermediate crude for May delivery rose 8.94% to $105.20 a barrel on the New York Mercantile Exchange, while front-month Brent crude climbed 7% to $102.29 a barrel.

Foreign investors turned net sellers again. On the Kospi, foreigners sold a net 464 billion won, while institutions offloaded a net 953.3 billion won. Retail investors bought a net 1.007 trillion won.

Moves among the Kospi’s largest companies were mixed. Samsung Electronics fell 2.43%, while SK Hynix rose 1.27%. Hanwha Aerospace, SK Square and Samsung Life Insurance advanced, while Hyundai Motor, LG Energy Solution, Samsung Biologics, Doosan Enerbility and KB Financial Group declined.

LS ELECTRIC jumped 13.71% on its first trading day after a stock split. Sanil Electric and Hyosung Heavy Industries also gained 12.64% and 4.01%, respectively, on expectations for solid earnings at power equipment makers.

The Kosdaq rose as well. The index closed at 1,099.84, up 6.21 points, or 0.57%, from the previous session. Retail investors were net buyers of 236.3 billion won on the Kosdaq, while foreigners and institutions were net sellers of 121.9 billion won and 96.6 billion won, respectively.

Samchundang Pharm, where investor sentiment remains divided, rebounded after one session and closed 4.16% higher at 526,000 won.

The won weakened against the dollar. In Seoul’s onshore market, the won-dollar exchange rate ended daytime trading at 1,489.3 won per dollar, up 6.8 won from the previous session.

Noh Jeong-dong, Hankyung.com reporter dong2@hankyung.com