The South Korean stock market has finished lower now in five consecutive trading days, declining more than 55 points or 2.7 percent along the way. The KOSPI finished just above the 2,080-point plateau, and now investors are bracing for continued consolidation at the opening of trade on Thursday.
The global forecast for the Asian remains brutal, spurred this time by open dissention in the latest OPEC meeting that sparks supply and pricing concerns for the commodity. Technology shares are expected to fall, along with gold, property, steel and airline stocks. The European and U.S. markets finished firmly under water, and the Asian bourses are tipped to open in similar fashion.
The KOSPI finished modestly lower again on Wednesday following losses among the automobile producers and ship builders.
For the day, the index lost 16.36 points or 0.78 percent to finish at 2,083.35 after trading between 2,068.78 and 2,109.11.
Among the actives, Hyundai Heavy Industries plunged 5.6 percent, Hyundai Motor shed 2.7 percent and Kia Motors fell 1.7 percent, while Hynix Semiconductor added 1.1 percent, Korean Air Line climbed 1.6 percent and Asiana Airlines collected 1.1 percent.
The lead from Wall Street continues to be negative as stocks moved lower on Wednesday with traders expressing continued concerns about the outlook for the economy. The markets extended a recent downward move, with the major averages once again falling to their worst closing levels in over two months.
The sustained weakness on Wall Street was partly due to continued reaction to comments from Federal Reserve Chairman Ben Bernanke, who spoke at the International Monetary Conference in Atlanta late in the trading day on Tuesday. In his remarks, Bernanke indicated the Fed is not likely to take additional steps to prop up the economy even though the recovery has been "uneven" and "frustratingly slow."
Selling pressure may also have been generated by a notable increase by the price of crude oil, which came after OPEC unexpectedly lefts its production quotas unchanged. Analysts had expected the 12-member group to boost production in an effort to cool off oil prices and take some pressure off the world economy.
Meanwhile, traders largely shrugged off the Federal Reserve's Beige Book report, which said reports from the twelve Fed Districts indicated that economic activity generally continued to expand. The Fed noted that a few districts indicated some deceleration.
The major averages all closed in negative territory, although the tech-heavy NASDAQ underperformed its counterparts. The Dow edged down 21.87 points or 0.2 percent to 12,048.94, while the NASDAQ fell 26.18 points or 1 percent to 2,675.38 and the S&P 500 slid 5.38 points or 0.4 percent to 1,279.56.
In economic news, South Korea's gross domestic product added 1.3 percent in the first quarter of 2011 compared to the previous three months, the Bank of Korea said on Wednesday. That was down slightly from the 1.4 percent increase cited in April's advanced estimate, although it still moved higher for the ninth consecutive quarter. GDP had added a quarterly 0.5 percent in the final three months of 2010. The annualized figure was unchanged, higher by 4.2 percent following the 0.5 percent increase in the fourth quarter of 2010.
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