RTTNews - The South Korea stock market on Thursday saw an end to the modest two-day winning streak in which it gained more than 50 points or 3.5 percent in the process. The KOSPI is holding on to support at 1,420 points, but now investors are bracing for continued declines at the opening of trade on Friday.
The global forecast for the Asian markets is pessimistic, with the financial shares expected to come under pressure after it was announced that Britain's AAA credit rating might be in jeopardy. Downbeat economic data reinforces the negative sentiment. The European markets finished sharply lower, as did the U.S. markets - and the Asian bourses are also predicted to take a hit.
The KOSPI finished modestly lower on Thursday, as the industrial shares fell under heavy selling pressure throughout the session. The losses were largely offset by strong gains among the brokerage stocks.
For the day, the index lost 14.05 points or 0.98 percent to close at 1,421.65 after trading between 1,412.73 and 1,433.07.
Among the decliners, Doosan Heavy Industries fell 6.52 percent, while Daewoo Shipbuilding & Marine Engineering lost 4.81 percent, Samsung Heavy Industries eased 0.65 percent, Samsung Electronics lost 2.26 percent, Hynix Semiconductor fell 7.24 percent and Ssangyong Motor fell 5 percent. Finishing higher, Samsung Securities gained 2.73 percent and Hyundai Securities rose 1.9 percent.
Wall Street offers a negative lead as stocks finished Thursday's session significantly lower after mild losses in the previous session. The major averages all closed in firmly negative territory as trader optimism dampened following the release of largely disappointing economic data.
The retreat came on the heels of another uninspiring jobs report from the U.S Labor Department for the week ended May 16. The data showed that first time jobless claims slowed but continuing claims rose for yet another week, reaching a new historic high. Meanwhile, the Philadelphia Federal Reserve's business activity index for the first half of May showed improvement but rose by less than expected, further mitigating risk appetite.
Some of the pessimism was moderated by forward looking indicators for April from the Conference Board, which came in slightly better than expected, raising some economic prospects for the coming months.
The broad-based losses on the day came as traders did some profit taking following the recent run-up seen in equities. In addition, with no considerable news on tap for Friday's session and markets closed on Monday for Memorial Day, equity markets worldwide saw considerable pullbacks.
The major averages opened notably lower following the jobs report and lingered in negative territory throughout the day, before finishing just off of their daily lows. Subsequently, the Dow closed down by 129.91 points or 1.54 percent to finish at 8292.13, the NASDAQ finished down by 32.59 points or 1.89 percent to end at 1695.25, and the S&P 500 also fell, closing down by 15.14 points or 1.68 percent to finish at 888.33.
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