Seoul Stocks Close Flat as Fed Rate Hike, Won Weakens
The Korea Composite Stock Price Index (KOSPI) ended largely unchanged on Thursday, down 0.04 percent, following the US Federal Reserve's rate increase, while the Korean won depreciated 13.6 won against the US dollar.
KOSPI Sees Limited Movement
Seoul's benchmark Korea Composite Stock Price Index (KOSPI) closed nearly flat on Thursday, 16 September 2026, registering a marginal decline of 2.56 points, or 0.04 percent, to 6,715.41. The index pared earlier gains throughout the day as investors reacted to the US Federal Reserve's decision to raise its base rate by a quarter of a percentage point.
This marks the Fed's first rate hike in over three years. Despite the move, market sentiment remained relatively mild, as the rate increase was largely anticipated by analysts, according to Lee Kyoung-min, an analyst at Daishin Securities.
Won Depreciates, Trading Volume Light
The Korean won weakened against the US dollar, trading at 1,382.2 won per greenback as of 3:30 p.m. on Thursday, a fall of 13.6 won from the previous session. Trading volume on the KOSPI was light, with 197.2 million shares changing hands, valued at 15.5 trillion won ($11.2 billion). Foreign investors were net sellers, offloading 2.27 trillion won worth of shares.
Conversely, retail and institutional investors collectively bought a net 572.48 billion won, providing some counter-balance to the market activity.
Sectoral Performance Mixed
Sector performance was mixed, with semiconductor stocks losing ground while defense and shipping companies saw gains. Among top-cap companies, Samsung Electronics shed 0.39 percent to 252,500 won, and rival SK Hynix declined 0.8 percent to 1,745,000 won.
In contrast, defense manufacturer Hanwha Aerospace rose 3.98 percent to 1,097,000 won, and shipbuilder HD Hyundai Heavy Industries jumped 6.58 percent to 469,500 won. Bond prices also closed mixed, with the yield on three-year Treasurys rising 1 basis point to 4.063 percent, while five-year government bond yields fell 2.6 basis points to 4.262 percent.
The won's depreciation could offer some relief for South Korean exporters by making their goods more competitive in international markets, potentially boosting revenue in local currency terms. However, the Federal Reserve's rate hike signals a tighter global monetary environment, which could temper investor appetite for riskier assets and impact capital flows into Asian markets.
Companies like Samsung Electronics and SK Hynix, with significant international sales, may see currency effects on their earnings reports, which investors will monitor in the upcoming quarterly results.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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