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Foreign selling spree sees Kospi close lower

Mar 05,2019
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Korea’s main bourse closed lower on Monday on heavy foreign selling amid concerns over prospects for the denuclearization of the Korean Peninsula, analysts said. The local currency weakened against the greenback.

The benchmark Kospi shed 4.78 points, or 0.22 percent, to finish at 2,190.66. Trading volume was moderate at 367.75 million shares worth 6.31 trillion won ($5.61 billion).

The index opened higher as investors picked up bargains following steep losses in the previous session when United States President Donald Trump and North Korean leader Kim Jong-un cut short of their much-anticipated second summit after failing to reach a deal.

But the earlier gains were pared and the index ended up in negative terrain as offshore investors turned to a selling mode to offload a net 123.4 billion won of local shares.

Institutions and retailers picked up 70 billion and 38.4 billion won worth of stocks, respectively.

“The local market appears to have been affected by the outcome of the second summit that failed to reach a deal on denuclearization,” Huh Jae-hwan, an expert at Eugene Investment & Securities, said.

“Investors instead seem to be focusing more on Chinese developments,” after Morgan Stanley Capital International (MSCI), which compiles the world’s share indexes, said that it will quadruple the amount of Chinese stocks in its key benchmarks this year, he added.

Auto shares tumbled to pull down the index. No. 1 automaker Hyundai Motor skidded 3.56 percent to 122,000 won, and Kia Motors sank 3.01 percent to 35,450 won.

Hyundai Engineering & Construction fell 5.07 percent to 54,300 won, and Namkwang Engineering & Construction nosedived 7.42 percent to 14,350 won.

Samsung Electronics went down 0.55 percent to 44,850 won, while SK Hynix inched down 0.14 percent to 70,100 won.

But auto shares rose. Celltrion surged 1.47 percent to 207,500 won, and Samsung Biologics increased 0.13 percent to 376,500 won.

The secondary Kosdaq rose 16.82 points, or 2.30 percent, to end the session at 748.07.

The tech heavy index went up following a rise in Nasdaq Composite Index, which gained 0.8 percent.

The local currency closed at 1,124.9 won against the U.S. dollar, up 0.2 won from Friday’s close.

Bond price ended lower. The yield on three-year bonds gained 2.1 basis points to 1.83 percent, and the return on benchmark 10-year government bonds rose 0.4 basis points to 2.03 percent.


BY JIN MIN-JI, YONHAP [jin.minji@joongang.co.kr]