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Stocks decline on U.S. interest rate concerns

Apr 25,2018
Korean stocks closed lower on Tuesday as foreign buyers went on a heavy selling spree amid worries over U.S. interest rate hikes and declining global smartphone and semiconductor demand. The Korean won depreciated against the U.S. dollar.

The benchmark Kospi surrendered 9.97 points, or 0.4 percent, to close at 2,464.14. Trade volume was slightly heavy at 8.1 trillion won ($7.5 billion).

Foreigners sold a net 438.8 billion won worth of shares on the main exchange. They sold semiconductor shares, tracking losses on the Philadelphia Stock Exchange semiconductor index, which fell 1.3 percent on Monday.

Individual and institutional investors scooped up net 271.1 billion won and 168.4 billion won.

“Today’s index fell due to losses in chip shares following the earnings announcement by SK Hynix. Foreigners offloaded technology and electronics shares,” said Seo Sang-young, an analyst at Kiwoom Securities.

Tech shares ended bearish, with top-cap Samsung Electronics losing 2.77 percent to end at 2,523,000 won. SK Hynix, a major chipmaker, was down 2.73 percent at 82,100 won after announcing earlier in the day that it posted the second-highest quarterly earnings for the first quarter of 2018. Its impressive performance fell slightly short of expectations of some analysts.

Auto shares ended in positive terrain. Korea’s leading automaker Hyundai Motor added 1.88 percent to 162,500 won. Its sister company Kia Motors was up 0.16 percent to 31,400 won, and Hyundai Mobis, the country’s top auto parts manufacturer, moved up 0.62 percent to 245,000 won.

The secondary Kosdaq fell 5.41 points, or 0.62 percent, to 873.61. The tech-heavy index fell for the second session in a row, as investors worried about declining semiconductor demand and overvalued pharmaceutical stocks.

Institutions and foreigners sold net 44.7 billion won and 62.7 billion won. Individuals bought a net 124.7 billion won. By sector, semiconductors and pharmaceuticals each declined by 1.5 percent and 1.3 percent.

Pharmaceutical giant SillaJen fell 5.23 percent to 83,300 won, while another leading bio firm Medytox dropped 4.29 percent to 657,600 won. Celltrion subsidiaries gained, with Celltrion Healthcare and Celltrion Pharm each rising 0.49 percent to 81,900 won and 4.36 percent to 88,500 won.

The local currency closed at 1,076.8 won against the U.S. dollar, up 7.8 won from the previous trading session.

BY KIM EUN-JIN, YONHAP [kim.eunjin1@joongang.co.kr]