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Market flat due to ‘Trump risk’ worries

May 20,2017
Seoul’s main bourse closed nearly flat on Friday as investors remained cautious about the “Trump risk,” analysts said. The local currency edged down against the U.S. dollar.

The benchmark Kospi closed at 2,288.48, up 1.66 points, or 0.07 percent, from the previous trading day. Foreign investors bought 41.4 billion won ($36.7 million) in shares, while retail investors offloaded 66.3 billion won worth. Institutional investors also sold 26.6 billion won in shares.

“As the first-quarter earnings season came to an end, market momentum has faded with offshore investors holding off increasing bets amid the Trump risk,” said Park Chun-young, an analyst at Daishin Securities Co. “The Kospi is expected to be more prone to any changes in the pattern of overseas investors and external factors next week.”

Shares of Hyundai Motor, the country’s top automaker, and its affiliates finished higher on expectations of a set of shareholder-friendly policies after local media reported that it will likely embark on a revamp of its complex governance structure.

The automaker jumped 3.03 percent to 170,000 won, with its auto parts-making affiliate Hyundai Mobis spiking 5 percent to 273,000 won. Hyundai Motor later denied such reports in its response to the financial regulator, saying the company has yet to decide on the plan.

Retailers and cosmetics firms also ended bullish on rising hopes for a thaw in strained Korea-China relations that have dented their businesses after Beijing imposed hostile policies in retribution for Seoul’s deployment of a U.S. antimissile system.

Top cosmetics maker AmorePacific advanced 1.27 percent to 359,500 won, with Lotte Shopping rising 1.1 percent to 276,500 won. Hotel Shilla, whose main business includes duty-free shops, also climbed 1.63 percent to 62,400 won.

In contrast, tech giant Samsung Electronics dipped 2.66 percent to 2,236,000 won on a foreign sell-off. Chipmaker SK hynix, the second-largest list-firm after Samsung, also fell 2.69 percent to 54,200 won.

The secondary Kosdaq closed at 642.45, up 4.33 points, or 0.68 percent, from the previous trading day. The won ended at 1,127.20 won against the greenback, down 2.7 won from Thursday’s close.

BY KIM YOUNG-NAM, YONHAP [kim.youngnam@joongang.co.kr]