RTTNews - Tracking an overnight fall on Wall Street and weakness exhibited by other markets across the Asia-Pacific region, the Korean stock market fell sharply in early trading on Thursday and is still down in the red with sharp losses.
Disappointing U.S. retail sales data dealt a blow to hopes of a quick economic recovery and sent stock prices tumbling on Wall Street on Wednesday and markets across the globe are feeling the heat early Thursday. With stocks across sectors having a free fall, the benchmark Korean index KOSPI is trading lower by 24.17 points or 1.71% at 1,390. Earlier, after opening at 1,396, it had edged up to 1,400.
Key bank stocks are trading sharply lower. Korea Exchange Bank, Shinhan Financial and KB Financial are down by 3% - 3.3%, while Woori Finance is trading lower by over 4%.
Among automobile stocks, Hyundai Motor and Ssangyong Motor are trading lower by 2.3% and 3.65%, respectively. However, Kia Motor has bucked the trend and is trading 0.8% up.
In the technology space, Hynix Semiconductor is trading flat. LG Display LCD and Samsung Electronics are down by 2.4% and 1.1% respectively while LG Electronics is trading nearly 2% up.
Oil stocks are trading weak with SK Holdings and S-Oil losing 4% and 2%, respectively. Energy stock KEPCO is down by 3.4%. Steel stocks are trading mixed. Hyundai Steel is up 3.7%, while POSCO is trading 3.4% down from its previous close.
Shipbuilders Hyundai Heavy Industries and Samsung Heavy Industries are down by 3.9% and 3.5%, respectively and Daewoo Shipbuilding is trading with a 2.7% loss. Bulk carrier STX Pan Ocean is down by 2%. Airlines and telecom stocks are also trading weak.
Among other markets in the Asia-Pacific region, Australia, Hong Kong, Japan, Singapore are trading sharply lower with their benchmark indices losing between 2% and 2.75%. Markets in New Zealand, Indonesia, Taiwan, Korea and Shanghai are also trading with sharp losses.
The KOSPI had ended 11 points or 0.78% up at 1,415 on Wednesday on bargain hunting after a loss in the previous session. Other stock markets across the Asia-Pacific region had turned in another mixed performance. While Hong Kong's Hang Seng Index fell 0.6 percent, Japan's benchmark Nikkei 225 Index closed up 0.5 percent.
Major European markets all saw considerable weakness on the day, with the U.K.'s FTSE 100 Index closing down 2.1 percent, while the French CAC 40 Index and the German DAX Index fell 2.4 percent and 2.6 percent, respectively.
On Wall Street, gloomy retail sales data for April triggered heavy selling in shares of retailers. Weak crude oil prices took a toll of energy stocks.
The report from the Commerce Department showed that retail sales unexpectedly fell for the second consecutive month in April after showing back-to-back increases in the first two months of the year. According to the report, retail sales fell 0.4 percent in April following a revised 1.3 percent decrease in March. Economists had expected sales to come in unchanged compared to the 1.2 percent decrease originally reported for the previous month.
In other economic news, a separate report from the Commerce Department showed a continued decrease in business inventories in the month of March. The report showed that business inventories fell 1.0 percent in March following a revised 1.4 percent decrease in February.
The major averages all closed firmly negative, with the Nasdaq ending the session at its worst level of the day. The Dow fell 184.22 points or 2.2 percent to 8,284.89, the Nasdaq closed down 51.73 points or 3 percent at 1,664.19 and the S&P 500 fell 24.43 points or 2.7 percent to 883.92.
Economic data is likely to remain in focus on Thursday. Traders are likely to keep a close eye on the Labor Department's weekly jobless claims report along with its report on wholesale price inflation for the month of April.
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