Seoul stocks to move in tight range this week after Fed chief's dovish comment

By Chung Joo-won

SEOUL, Aug. 29 (Yonhap) -- South Korean stocks are likely to move in a tight range next week as investors' profit-taking mode may be balanced against the U.S. Federal Reserve chairman's dovish comments.

The benchmark Korea Composite Stock Price Index (KOSPI) closed at 3,133.9 points Friday, up 2.4 percent from a week ago.

The weekly gain came as investors bet that the U.S. Federal Reserve would not hurry its timeline for tapering its stimulus and policy interest rates in the Jackson Hole meeting that took place Friday (U.S. time).

Fed Chair Jerome Powell said the Fed could begin tapering its asset purchases this year, citing signals of U.S. economic recovery from the pandemic, but the Fed would not hurry to raise the key interest rates, he said.

Boosted by the Fed chief's dovish comment, the tech-heavy Nasdaq composite jumped 1.23 percent on eased concern about rate hikes. The Dow Jones Industrial Average added 0.69 percent and the S&P 500 gained 0.88 percent.

On Thursday, the Bank of Korea (BOK) delivered its first pandemic-era rate hike to control inflation and household debt, ending 15 months of record-low interest rates.

"The KOSPI does not seem to have any positive factors for gains in the short term, except some technical rebound by some over-sold stocks," NH Investment & Securities analyst Kim Young-hwan said.

He expected the economic data to be released this week to come short of quenching concerns about slowing rebound from the pandemic.

China's purchasing managers' index (PMI) for August will be released Tuesday.

South Korea's August export data will be published Wednesday.

The U.S. Institute for Supply and Management (ISM) manufacturing index and the jobless data for August will be printed on Thursday and Friday in Korea time, respectively.

jwc@yna.co.kr
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