South Korean stocks are likely to trade in a tight range next week as investors watch out for second-quarter earnings results and the Fed's two-day policy meeting, analysts said Saturday.
The benchmark Korea Composite Stock Price Index (KOSPI) closed at 2,045.96 on Friday, falling 1.48 percent from a week earlier.
The KOSPI kicked off on a slightly weak note as profit concerns on major shipbuilders offset easing worries over Greece and China.
Later in the week, the index moved lower as foreigners extended their selling mode to a sixth straight session amid a weakening won.
The local currency sank to a three-year low of 1,167.9 won against the U.S. dollar on Friday amid rising expectations for a U.S. rate hike, with the Federal Open Market Committee (FOMC) scheduled for next week.
Analysts said the KOSPI is likely to range bound as investors remain wary over second-quarter earnings and offshore investors continue to slim down their holdings.
"Worries over sectors that receive orders are escalating.
Meanwhile, despite easing external woes, foreigners are selling on the local bourse amid a strengthening dollar," said Ko Seung-hee, an analyst at KDB Daewoo Securities Co., referring to sluggish earnings at builders and shipyards.
Kim Byung-yeon of NH Investment & Securities Co. said investors are likely to step to the sidelines ahead of the Fed meeting.
"Investors are likely to take a wait-and-see stance ahead of the FOMC meeting. Meanwhile, shares are expected to move in different directions, depending on their earnings," he said.
The second-quarter earnings season is under way, but some market heavyweights are scheduled to release their earnings next week. They include Samsung Electronics, which is expected to announce its quarterly results on Thursday.
The two-day FOMC meeting will be held on Tuesday and Wednesday.
There will be no press conference after next week's meeting. (Yonhap)
