SEOUL, March 20 (AJP) — Asian equity markets showed mixed results with limited volatility on Friday, yet a sharp divide emerged between Seoul and Tokyo. While the tech-heavy KOSDAQ rallied by over 1 percent, Japanese stocks suffered a bruising "Black Friday" as monetary tightening fears gripped the Nikkei.
The South Korean won showed no signs of recovery amidst the prolonged blockade of the Strait of Hormuz and the U.S. Federal Reserve’s hawkish stance on interest rates.
Although the won rose to the 1,480 level during intraday trading, it surrendered all gains to close at 1,500 per dollar, unchanged from the previous session. Signals from the Bank of Japan (BOJ) regarding a potential rate hike on Thursday - right after the rate freeze - also weighed heavily on regional currency markets.
With both the Fed and the BOJ maintaining hawkish leanings, as the impact of the Strait of Hormuz blockade on the South Korean economy began to materialize, the yield gap between South Korea’s long-term and short-term bonds narrowed further.The 10-year treasury yield fell 4.3 basis points to 3.736 percent, while the 3-year yield jumped 8.1 basis points to 3.410 percent.
The benchmark KOSPI closed at 5,781.20, up 0.31 percent. Despite a mountain of external risks, the index managed a slight gain, led by a rally in alternative energy stocks. Retail investors net purchased 2.23 trillion won ($1.50 billion) and institutional investors bought 403.4 billion won, while foreign investors offloaded 2.67 trillion won in flight to safety and profit-taking moves.
Alternative energy stocks, including nuclear and solar power, surged as the Middle East conflict continued to choke petroleum supply chains. Doosan Enerbility, a leader in domestic gas turbines, rose 3.1 percent to 109,600 won ($73.68). SK Innovation also climbed 3.26 percent to 113,900 won after its subsidiary, TerraPower, received a construction permit for an advanced nuclear reactor from the U.S. Nuclear Regulatory Commission (NRC).
Daewoo E&C, which declared its entry into the nuclear sector last year, posted the largest gain, soaring 18.18 percent to 19,110 won. Hanwha Solutions, the nation’s top solar module maker, recovered previous losses to close at 51,700 won, up 3.92 percent. In contrast, heavyweights Samsung Electronics and SK Hynix weakened, falling 0.55 percent and 0.6 percent, respectively.
The KOSDAQ index experienced a solitary surge, largely driven by the biotech sector ahead of the American Association for Cancer Research (AACR) annual meeting in April. Samchundang Pharm reclaimed the top spot in market capitalization, jumping 14 percent to 112,000 won following its success in developing a biosimilar for Eylea. Peptron, specializing in peptides, also soared 9 percent to 28,500 won.
The Nikkei 225 plummeted 3.38 percent to close at 53,372.53. Beyond the Middle East risk and the Fed’s rate freeze, remarks from BOJ Governor Kazuo Ueda acted as a major headwind. Ueda signaled a potential rate hike, noting that "the view to prioritize upside risks to inflation is prevailing."
Export-driven stocks, which have long benefited from low rates, took a hit. Market leader Toyota fell 2.32 percent to 3,325 yen ($21.84), and Honda dropped 3.2 percent. Semiconductor-related stocks also suffered, with Advantest and Tokyo Electron falling 4.58 percent and 2.38 percent, respectively. Notably, SoftBank Group Corp. plunged 5.12 percent to 3,558 yen on concerns over rising interest expenses as the "weak yen" era nears its end.
Taiwan’s TAIEX edged down 0.43 percent to 33,543.88. While TSMC fell 0.54 percent to 1,840 TWD ($58.12) and Foxconn lost 1 percent, MediaTek rose 1.2 percent to 1,700 TWD, buoyed by its partnership with Nvidia and the success of the Dimensity 9500 chip.
In Mainland China, sentiment remained subdued. The Shanghai Composite Index fell 1.24 percent to 3,957.05 on recession fears linked to the Hormuz blockade, while the SZSE Component remained relatively flat, dipping only 0.25 percent to 13,866.20.
Copyright ⓒ Aju Press All rights reserved.