KOSPI May Give Up Support At 2,600 Points

(RTTNews) - The South Korea stock market on Wednesday halted the four-day winning streak in which it had jumped more than 75 points or 2.9 percent. The KOSPI now rests just above the 2,615-point plateau and it's likely to open under pressure again on Thursday.

The global forecast for the Asian markets is broadly negative following a downgrade in the United States' credit rating. The European and U.S. markets were firmly lower and the Asian markets are expected to open in similar fashion.

The KOSPI finished sharply lower on Wednesday with damage across the board, especially among the financials, technology stocks and industrials.

For the day, the index tumbled 50.60 points or 1.90 percent to finish at 2,616.47. Volume was 694.5 million shares worth 15.7 trillion won. There were 652 decliners and 230 gainers.

Among the actives, Shinhan Financial and KEPCO both dropped 0.97 percent, while KB Financial fell 0.38 percent, Hana Financial retreated 1.25 percent, Samsung Electronics was down 1.69 percent, Samsung SDI slumped 2.99 percent, LG Electronics declined 3.11 percent, SK Hynix tumbled 4.48 percent, Naver weakened 2.36 percent, LG Chem stumbled 1.98 percent, Lotte Chemical shed 0.69 percent, S-Oil added 0.40 percent, SK Innovation sank 3.90 percent, POSCO plummeted 5.80 percent, SK Telecom lost 0.43 percent, Hyundai Mobis surrendered 3.60 percent, Hyundai Motor tanked 3.46 percent and Kia Motors plunged 3.96 percent.

The lead from Wall Street suggests consolidation as the major averages opened lower and remained in the red throughout the trading day, ending near session lows.

The Dow tumbled 348.16 points or 0.98 percent to finish at 35,282.52, while the NASDAQ sank 310.47 points or 2.17 percent to end at 13,973.45 and the S&P 500 dropped 63.34 points or 1.38 percent to close at 4,513.39.

The sell-off on Wall Street came after credit rating agency Fitch Ratings unexpectedly downgraded the United States' credit rating. Fitch downgraded the U.S.' long-term foreign-currency issuer default rating to AA+ from AAA, citing a "steady deterioration in standards of governance over the last 20 years."

In U.S. economic news, payroll processor ADP said U.S. private sector employment jumped more than expected in July. But while the report points to continued strength in the U.S. labor market, the data may lead to renewed concerns about the outlook for interest rates.

On Friday, the Labor Department is scheduled to release its more closely watched report on employment in July.

Crude oil prices tumbled on Wednesday amid concerns about outlook for demand, despite data showing a massive drop in crude stockpiles in the U.S. last week. West Texas Intermediate Crude oil futures for September ended lower by $.88 or 2.3 percent at $79.49 a barrel.