Seoul stocks likely to face volatility next week on Omicron scare
Dealers at Hana Bank work at a dealing room at the lender's headquarters in Seoul, Dec. 3. Yonhap
Stocks on local bourses are likely to continue to face volatility next week as investors take to the sidelines amid the spreading Omicron strain of COVID-19.
The benchmark Korea Composite Stock Price Index (KOSPI) closed at 2,968.33 points Friday, up 1.09 percent from 2,936.44 points a week ago.
The KOSPI plunged Monday and Tuesday in the wake of the first confirmed cases of the Omicron variant in South Korea and other countries, fanning concerns major economies around the world may toughen their lockdown measures to contain the pandemic.
The key stock index rebounded afterwards largely on foreign investors' rush to scoop up oversold chip and IT stocks.
Analysts said volatility in the stock market may increase next week, citing uncertainties from the renewed fear of COVID-19.
Investors are keeping close tabs on the fatality rate and resistance to existing COVID-19 vaccines.
"Global stock markets are expected to remain sensitive to the daily news about the Omicron wave," said NH Investment & Securities analyst Kim Young-hwan.
The emergence of the potentially more transmissible variant is a setback to South Korea's efforts to return to normalcy with a gradual easing of virus restrictions under the "Living with COVID-19" strategy that began last month.
On Friday, the government decided to limit private gatherings to six people in the capital area and eight in other regions for four weeks, starting next week.
"Investors seem worried that the global economies' toughened lockdown measures could affect production," Kim added. (Yonhap)