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Market tumbles as foreign selloff continues

Dec 07,2017
Korea’s main index tumbled Wednesday as foreign investors remained net sellers of stocks, with sentiment soured over geopolitical worries in the Middle East. The Korean won also fell against the U.S. dollar.

The benchmark Kospi closed at 2,474.37, down 35.75 points from the previous session. Trade volume was moderate at 503 million shares worth 6.56 trillion won ($6 billion).

The local stock market opened lower as investors took their cues from overnight declines on Wall Street. Geopolitical worries in the Middle East emerged on news that U.S. President Donald Trump would recognize Jerusalem as Israel’s capital.

Lee Young-kon, a Hana Financial Investment analyst, said local stock markets are expected to face an “adjustment mode for the time being” after recent rallies.

Samsung Electronics, the largest listed company by market capitalization, fell 2.42 percent to 2,501,000 won, and SK Hynix, a global chipmaker, edged down 0.51 percent to 77,500 won. Naver, operator of the country’s top search engine, dropped 0.84 percent at 826,000 won.

Automakers were in positive terrain, with industry leader Hyundai Motor up 0.31 percent to end at 162,000 won, and affiliate Kia Motors gaining 0.44 percent to close at 33,900 won.

Cosmetics giant AmorePacific fell 1.04 percent to 333,000 won, tobacco maker KT&G dropped 1.66 percent to 118,500 won and oil refiner S-Oil retreated 1.21 percent to 122,000 won.

Samsung Heavy Industries, which notified investors of an upcoming 490 billion won operating loss this year along with plans to increase capital by issuing new stocks, plunged 28.89 percent to 8,960 won. Concerns on the overall shipbuilding industry dragged down shares of Hyundai Heavy Industries and Daewoo Shipbuilding and Marine Engineering as well.

The secondary market, the Kosdaq, closed at 768.39, down 5.73 points from the previous day. The top player, drugmaker Celltrion, lost 1.9 percent to close at 201,300 won. Loen Entertainment fell 1.26 percent, and Medytox dropped 6.03 percent.

Biotech company SillaJen, on the other hand, advanced 9.22 percent to 98,300 won. Entertainment giant CJ E&M also rose 1.71 percent to 89,200 won.

The local currency closed at 1,093.70 won against the U.S. dollar, down 7.9 won from the previous session.

Bond prices, which move inversely to yields, closed higher. Returns on three-year government bonds fell 2.8 basis points to 2.08 percent, while returns on five-year bonds declined 2.5 basis points to 2.27 percent.

BY KIM JEE-HEE, YONHAP [kim.jeehee@joongang.co.kr]