South Korean shares fall more than 3% as Iran war escalates

SEOUL: Round-up of South Korean financial markets:

South Korean shares fell more than 3% on Wednesday, weighed by rising bond yields on escalating conflict between the US and Iran.

The benchmark KOSPI was down 214.27 points, or 3.13%, at 6,621.53 as of 0158 GMT.

US stocks extended their slide on Tuesday, as the global bond selloff deepened and crude prices spiked amid fading hopes for a near-term solution to the US-Israeli war with Iran.

The US launched a barrage of air strikes against Iran on Tuesday, prompting Iranian retaliation, in the most serious escalation in weeks in a conflict that has driven up global energy prices and weighed on President Donald Trump’s popularity.

“Negative sensitivity to macroeconomic variables, such as oil prices and bond yields, has risen,” said Han Ji-young, an analyst at Kiwoom Securities.

South Korea’s consumer inflation quickened in August due to low-base effects from the previous comparable period a year ago, data showed on Wednesday, but was lower than expectations.

Among index heavyweights, chipmaker Samsung Electronics fell 3.26%, while peer SK Hynix lost 3.72%. Battery maker LG Energy Solution slid 3.81%.

Hyundai Motor and sister automaker Kia Corp were down 5.24% and down 5.26%, respectively.

Steelmaker POSCO Holdings shed 2.93%, while drugmaker Samsung BioLogics fell 1.64%.

Of the total 907 traded issues, 150 shares advanced, while 731 declined. Foreigners were net sellers of shares worth 890.2 billion won ($649.8 million).

The won was quoted at 1,370.2 per dollar on the onshore settlement platform, 0.35% higher than its previous close at 1,375.0.

In money and debt markets, September futures on three-year treasury bonds lost 0.14 point to 102.99.

The most liquid three-year Korean treasury bond yield rose by 2.9 basis points to 3.920%, while the benchmark 10-year yield rose by 5 basis points to 4.421%.‑Reuters