09.24 Mon

Business

Kospi closes lower due to tech share sell-off

Aug 11,2018
Korean stocks closed lower on Friday as foreign and institutional buyers went on a heavy selling spree of large-cap tech shares amid a strong U.S. dollar. The Korean won depreciated against the greenback.

The benchmark Kospi plunged 20.92 points, or 0.91 percent, to close at 2,282.79. Trading volume was moderate at 6.1 trillion won ($5.5 billion).

Foreigners sold a net 114.7 billion won and institutions offloaded a net 87.1 billion won worth of shares on the main exchange. Individual investors scooped up a net 149.2 billion won.

“It is highly possible that the local stock market will slow down in the face of a strong U.S. dollar and the overall slump of the U.S. semiconductor sector,” said Hong Choon-wook, an analyst at Kiwoom Securities.

On Friday, Morgan Stanley lowered its rating for the semiconductor industry from “in-line” to “cautious,” citing signs of overheating in the sector. The investment bank expects the industry to underperform throughout the next year.

Most large-cap shares ended lower, with the tech stocks pulling down the Kospi.

Top cap Samsung Electronics lost 3.2 percent to end at 45,400 won to close a five-day winning spree. Its smaller rival, LG Electronics, shed 1.74 percent to 79,000 won. Chipmaker SK Hynix was down 3.72 percent to 75,100 won.

Shares of biopharmaceutical companies ended mixed, with Samsung BioLogics, Samsung’s biopharmaceutical affiliate, adding 0.87 percent to end at 464,000 won to continue a six-day winning streak. Celltrion was down 1.45 percent at 272,000 won.

Hyundai Motor, the country’s No. 1 carmaker, remained unchanged at 126,000 won. Its sister company Kia Motors was up 0.62 percent to 32,250 won, while Hyundai Mobis, the country’s top auto parts manufacturer, moved down 0.64 percent to 231,500 won.

The secondary Kosdaq fell 4.67 points, or 0.59 percent, to 784.81, dragged down by a 1.1-percent fall in the Philadelphia Semiconductor Index.

Large institutional and foreign selling of IT and semiconductor shares also pushed the tech-heavy index down.

The Korean won closed at 1,128.9 won against the U.S. dollar, up 11.7 won from the previous trading session.

Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds fell one basis point to 2.04 percent, and the return on 10-year bonds lost 3.1 basis points to 2.49 percent.


BY KIM EUN-JIN, YONHAP [kim.eunjin1@joongang.co.kr]
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