South Korean stocks ended near flat Thursday after the Bank of Korea lowered the key rate to spur growth in a widely expected move, but without giving a clear signal of a further cut, analysts said. The local currency rose against the U.S. dollar to a two-week high.
The benchmark Korea Composite Stock Price Index fell 0.04 percent, or 0.86 point, to 2,063.22. Trading volume was thin at 267.3 million shares worth 3.7 trillion won ($3.6 billion), with gainers beating losers 495 to 319.
Analysts said investors responded modestly because the BOK‘s rate cut met market expectations. The central bank lowered the rate by 25 basis points to 2.25 percent.
“Some investors sold stocks on news of the lowered key interest rate, believing market expectations were already priced in,” said Min Byung-kyu of Tongyang Securities Co. “The rate cut itself fell short of giving momentum to the stock market as it is not yet clear whether the BOK will further drop rates later this year.”
Min said the rate cut is a bullish factor in the mid to long term as the central bank showed its willingness to join the finance ministry’s aggressive efforts to boost domestic consumption and enliven the equity market. (Yonhap)
