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Kospi stumbles on fear of U.S.-China tensions

Oct 03,2018
Korean stocks closed sharply lower Tuesday as tensions between the United States and China continued to grow over trade and geopolitical issues. The Korean won depreciated against the U.S. dollar.

The benchmark Kospi plunged 29.31 points, or 1.25 percent, to close at 2,309.57. Trading volume was 6.1 trillion won ($5.4 billion).

Analysts said Seoul shares closed lower as investors were concerned about tensions between the U.S. and China, especially over the South China Sea.

“Along with the U.S.-China trade dispute, the military tensions between the two countries weighed down on investor sentiment, inducing foreigners to offload shares and futures,” said Lee Kyoung-min, an analyst from Daishin Securities.

Overseas investors sold a net 243 billion won worth of shares on the main exchange. Individual investors scooped up a net 308 billion won while institutions offloaded a net 81 billion won.

Samsung Electronics shed 1.4 percent to 45,700 won, and No. 2 chipmaker SK Hynix slid 2.71 percent to 71,700 won. LG Electronics lost 1.69 percent to 69,900 won.

Pharmaceutical firms were also among the losers, with Celltrion decreasing 1.2 percent to close at 288,500 won and Samsung BioLogics falling 4.28 percent to 515,000 won. Hanmi Pharmaceutical also shed 1.49 percent to 462,500 won.

Chemical firms also finished lower. LG Chem lost 4.21 percent to 353,000 won, and LG Household & Health Care moved down 1.44 percent to 1,297,000 won. Amorepacific decreased 1.86 percent to 264,500 won.

Top carmaker Hyundai Motor fell 0.39 percent to 128,500 won, and Kia Motors gained 1.16 percent to 34,750 won. Auto parts maker Hyundai Mobis lost 1.36 percent to 218,000 won.

Builders ended higher, with GS Engineering & Construction rising 0.37 percent to 54,700 won and Daelim Industrial adding 3.5 percent to 85,700 won.

The secondary Kosdaq also fell 21.54 points, or 2.64 percent, to 794.99. The tech and bio-heavy index was dragged down by institutional and foreign selling of pharmaceutical and IT shares.

The Korean won closed at 1,119.20 won against the U.S. dollar, up 7.40 won from the last trading session.

Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds fell 0.7 basis points to 2.02 percent, and the return on 10-year bonds was down 1.3 basis points to 2.37 percent.

The market will be closed Wednesday for National Foundation Day.

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