South Korean shares fell on Wednesday morning with the sentiment dampened by concerns over global growth and sliding oil prices.
The market was also marking time ahead of expectations the European Central Bank (ECB) will unveil more stimulus measures when it convenes for its monthly policy meeting on Thursday.
“Many of the past ECB meetings have resulted in a pattern of anticipation and subsequent disappointment at the lack of decisive action, but it is different this time around in the fact that they’ve taken the first step towards buying government bonds,’’ said Oh Seung-hoon, an analyst at Daishin Securities.
The Korea Composite Stock Price Index (KOSPI) was down 0.4 per cent at 1,910.70 points as of 0150 GMT.
The International Monetary Fund (IMF) had this week sharply cut its growth outlook for 2015 and 2016 in almost every region except the United States, amid slowing growth in China.
Commodity-linked sectors such as shipyards and refiners underperformed as oil prices resumed their falls. Daewoo Shipbuilding & Marine Engineering slid 2 per cent, while SK Innovation dipped 1.8 per cent.
However, cheap oil was a boon to airliners as it bolstered the expectations of lower jet fuel costs, pushing the shares in Asiana Airlines up 1.8 per cent. SK Hynix gained 2.1 per cent with analysts saying the South Korean chipmaker was better positioned for a transition to newer DRAM processes compared with US rival Micron Technology.
The KOSPI 200 benchmark of core stocks fell 0.15 per cent while the junior, tech-heavy KOSDAQ gained 0.49 per cent.
The South Korean won held nearly steady against the dollar in a choppy trading session, although investors were guarded over the Bank of Japan’s (BoJ) policy announcement due later in the day.
Although the BoJ is likely to stand pat, some market players are bracing for a shock move given Governor Haruhiko Kuroda’s tendency to surprise markets with unexpected measures such as its massive stimulus expansion last October.
The local currency was trading at 1,088.2 to the dollar as of 0150 GMT, compared with 1,088.4 quoted at Tuesday's session close. March futures on three-year treasury bonds shed 1 basis point to trade at 108.55.