[Featured Stocks] Naver and Kakao Weaken Amid US Interest Rate Hike Concerns

Concerns over interest rate hikes by the U.S. Federal Reserve (Fed) have intensified, leading to a decline in the stock prices of South Korea's leading growth stocks, NAVER and Kakao, on the 8th.

As of 9:37 a.m. on the day, NAVER was trading at 201,000 KRW on the Korea Exchange, down 1.95% from the previous trading day.

At the same time, Kakao was also down 1.57% from the previous trading day, trading at 56,500 KRW.

On the 7th (local time), the Bank of Canada (BOC) raised its benchmark interest rate by an additional 0.25 percentage points, increasing market concerns about the possibility of a U.S. rate hike.

Initially, the market expected Canada to keep its benchmark interest rate unchanged, but after holding rates steady for two consecutive months in March and April, the Bank of Canada pulled out the rate hike card again due to persistent inflationary pressures.

Earlier this week, the Reserve Bank of Australia (RBA) also surprised the market with a rate hike, contrary to expectations, raising concerns that the U.S. Fed might not hold rates steady in June as the market had anticipated.

As the possibility of a Fed rate hike increased, this put pressure on tech stocks, causing the tech-heavy Nasdaq index to close down 1.29% from the previous session.

Typically, during periods of rising interest rates when market liquidity tightens, investors tend to base their investments on current earnings rather than future growth potential, which negatively impacts tech stocks.