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Market inches down as foreigners sell

Sept 06,2017
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Seoul’s main bourse closed lower for the fourth session Tuesday on concerns over North Korea’s nuclear provocations, but the decline slowed compared to previous sessions as investors engaged in bargain hunting, analysts said.

The benchmark Kospi dropped 3.03 points, or 0.13 percent, to 2,326.62. Trade volume was moderate at 317 million shares worth 4.81 trillion won ($4.25 billion), with losers outnumbering gainers at 569 to 239.

The index sank more than 1 percent the previous trading day as retail investors dumped local shares after North Korea claimed Sunday that it successfully tested a hydrogen bomb that can be mounted on an intercontinental ballistic missile.

While the main bourse continued to lose ground on Tuesday, analysts said the downward pressure was limited as institutions scooped up underappreciated shares.

“Based on past examples, foreigners and institutions tend to consider the North Korean risk an opportunity to purchase bargain shares,” said Byun Joon-ho, a researcher from Hyundai Motor Investment & Securities.

Institutions scooped up a net 243.2 billion won, while individual investors offloaded a net 66.2 billion won. Foreigners sold more shares than they bought at 210.9 billion won.

Tech shares closed bullish, with Samsung Electronics moving up 1.56 percent to 2,338,000 won. Leading chipmaker SK Hynix shot up 2.64 percent to 69,900 won. LG Electronics also jumped a whopping 4.59 percent to 86,500 won.

Carmakers closed mixed, with Hyundai Motor backtracking 1.43 percent to 138,000 won while its auto parts arm Hyundai Mobis closed unchanged at 238,500 won. Kia Motors, the second largest automaker shed 2.29 percent to 34,100 won.

The secondary Kosdaq closed at 648.75, down 2.14 points, or 0.33 percent from the previous session. Sell offs from foreign investors contributed to the decline.

The local currency closed at 1,131.1 won against the U.S. dollar, strengthening 0.2 percent from the previous session’s close.

The yield on three-year government bonds hardly changed at 1.78 percent and the return on the 10-year government bonds were also steady at 2.31 percent.


BY SONG KYOUNG-SON, YONHAP [song.kyoungson@joongang.co.kr]