The South Korean stock market broke its two-day winning trend, during which it had escalated nearly 70 points, or 2.6%, on Thursday. The KOSPI ended slightly above the 2,710-point plateau, suggesting potential recovery on Friday.
Positive global forecasts, driven by improving interest rate outlooks, influenced markets worldwide. Gains were observed in European and U.S. markets, and the Asian markets are predicted to emulate this upswing.
However, the KOSPI experienced a significant decline on Thursday, affected by the dwindling performance of financial shares, technology stocks, chemical companies and automobile producers. The index dipped by 32.91 points or 1.20% to close at 2,712.14 after a fluctuating trade day. Approximately 413 million shares traded hands, worth 10.9 trillion won. The day ended with 531 decliners and 355 gainers.
Key active players included Shinhan Financial, which fell by 1.69% while KB Financial loosened by 1.42%. Other players like Hana Financial, Samsung Electronics, Samsung SDI, LG Electronics, SK Hynix, Naver, LG Chem, Lotte Chemical, S-Oil and SK Innovation also suffered losses. Conversely, SK Telecom and KEPCO experienced gains. Meanwhile, Hyundai Mobis, Hyundai Motor, and Kia Motors saw significant downturns.
Optimism emanating from Wall Street paints a mildly optimistic picture as the principal averages, initially subdued, rebounded positively throughout Thursday. The Dow leaped 331.36 points or 0.85% to end at 39,387.76, while NASDAQ closed at 16,346.26, up 43.46 points or 0.27%. The S&P 500 added 26.41 points or 0.51% to reach 5,214.08.
Wall Street's strength was fuelled further by the Labor Department's announcement of an unexpected increase in first-time claims for U.S. unemployment benefits last week. This news has sparked renewed optimism that the Federal Reserve may decrease interest rates in upcoming months. Chances of a rate reduction by September have surged to 89.3%, according to CME Group's FedWatch Tool.
Meanwhile, oil prices also inclined, encouraged by optimistic demand outlooks and a larger than anticipated dip in U.S. crude inventories last week. West Texas Intermediate Crude oil futures for June ended higher by $0.27 at $79.26 a barrel.