Seoul (South Korea), March 6: South Korean stocks are likely to continue choppy trading next week following this week's highly volatile trading, as concerns about a U.S. Treasury yields hike still loom over the local financial market, analysts said Saturday.
The benchmark Korea Composite Stock Price Index (KOSPI) closed at 3,026.26 points Friday, down 0.44 percent from a week ago.
Foreigners dumped a net 1.1 trillion won (US$976 million) at the main bourse this week as the yields of benchmark 10-year U.S. Treasury exceeded 1.5 percent, sparking inflation worries.
The KOSPI dipped in the last two sessions, as the U.S. Federal Reserve did not make signals to reign in the rising bond yields, which some investors took as a precursor of early post-pandemic inflation.
The fall slowed Friday afternoon, however, following Chinese policymakers' soothing comments that there will be no sudden change in the existing macroeconomic policies.
Analysts said the yield hike would continue to add downward pressure to the local stock prices next week.
"The Federal Reserve recently stepped up multiple times to pacify the markets when a rise in bond yields frightened the investors," NH Investment & Securities analyst Kim Young-hwan said.
"But investors would have to brace themselves for the absence of such buffer since Fed officials are forbidden to publically comment on the issue for seven days before the next FOMC meeting," he said.
Source: Yonhap