KOSPI May Test Support At 6,600 Points

(RTTNews) - The South Korea stock market has tracked lower in four straight sessions, tumbling more than 420 points or 5.9 percent in that span. The KOSPI now sits just above the 6,625-point plateau and it may extend its losses again on Wednesday.

The global forecast for the Asian markets is negative on rising crude oil prices and treasury yields, and ahead of the U.S. rate decision later today. The European and U.S. markets were down and the Asian bourses are expected to open in similar fashion.

The KOSPI finished modestly lower on Tuesday following losses from the technology stocks, defense stocks and shipbuilders.

For the day, the index sank 57.11 points or 0.85 percent to finish at 6,627.26. Volume was 274 million shares worth 16.2 trillion won. There were 621 decliners and 253 gainers.

The lead from Wall Street is weak as the major averages opened lower on Tuesday and remained in the red throughout the trading day.

The Dow dropped 328.09 points or 0.63 percent to finish at 62,093.11, while the NASDAQ shed 204.84 points or 0.78 percent to end at 25,981.57 and the S&P 500 fell 34.25 points or 0.45 percent to close at 7,585.73.

The weakness on Wall Street came amid a notable increase in treasury yields, with the yield on the benchmark ten-year note reaching its highest intraday level since July 2007.

Concerns about the outlook for inflation and interest rates have driven yields higher ahead of the Federal Reserve's monetary policy decision later today. The Fed is widely expected to raise interest rates, with CME Group's FedWatch Tool currently indicating a 94.5 percent chance of a quarter-point rate hike.

A sharp increase by the price of crude oil also weighed on stocks amid reports of fresh Houthi strikes on Saudi Arabia. But traders seemed reluctant to make more significant moves ahead of the Fed's monetary policy announcement.

Crude oil prices surged on Tuesday as supply concerns mount after Saudi Arabia shut its East-West pipeline. West Texas Intermediate crude for October delivery was up $4.37 or 4.31 percent at $105.76 per barrel.