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Seoul stocks inch down as trade war intensifies

June 05,2019
Local stocks closed lower Tuesday, ending a three-day winning streak as weak economic data and the intensifying U.S.-China trade war sapped investor sentiment. The won lost ground against the dollar.

After a choppy session, the benchmark Kospi inched down 0.88 point, or 0.04 percent, to 2,066.97. Trading volume was moderate at 428.18 million shares worth 4.77 trillion won ($4.03 billion), with winners beating losers 529 to 294.

The index had a volatile session to end slightly lower as tech blue chips were depressed after the tech-heavy Nasdaq dropped 1.6 percent Monday following news of an antitrust probe into U.S. tech giants, including Amazon, Facebook and Apple.

“The local stock market went into a correction territory, tracking tech losses on Wall Street,” said Seo Sang-young, an analyst at Kiwoom Securities. “As investors are in a bargain hunting mode following the recent fall of Korean stocks, the scope of fall was limited, however.”

The Bank of Korea said the Korean economy shrank at a faster rate of 0.4 percent in the first quarter than earlier expected because of sluggish investment and exports in the wake of trade tension between the United States and China.

Foreign investors sold a net 199 billion won worth of stocks, ending their buying binge for the third consecutive session, while institutions and retail investors bought a net 192 billion won and 3.3 billion won, respectively, to offset the losses.

Tech heavyweights were among the biggest losers of the day.

Samsung Electronics slipped 0.8 percent to 43,450 won, and memory chip giant SK Hynix sank 2.25 percent to 65,100 won.

Naver, Korea’s top portal operator, dipped 3.48 percent to 111,000 won.

In contrast, bio and telecom shares were up.

Samsung BioLogics, a health care unit of Samsung, jumped 4.66 percent to 314,500 won, and SK Telecom, the nation’s leading mobile carrier, increased 1.6 percent to 254,000 won.

The secondary Kosdaq gained 5.02 points, or 0.72 percent, to close at 702.53. The index ended higher for three consecutive days and recovered over the 700 mark as institutions mass purchased tech stocks despite seeing Nasdaq shares end lower overnight.

The won closed at 1,182.8 won against the dollar, up 0.7 won from Monday’s close.

Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds lost 0.5 basis points to 1.570 percent, and the return on 10-year bonds fell 0.7 basis points to 1.684 percent.

BY KO JUN-TAE, YONHAP [ko.juntae@joongang.co.kr]