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Market holds its breath over U.S.-China talks

June 26,2019
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Shares closed lower Tuesday with losses in tech and bio shares as investors remained cautious ahead of U.S.-China talks later this week, local analysts said. The won continued to gain against the dollar.

The benchmark Kospi lost 4.69 points, or 0.22 percent, to close at 2,121.64. Trade volume was moderate at 634 million shares worth 4.1 trillion won ($3.5 billion), with losers outnumbering gainers 574 to 257.

The main bourse opened higher to initially surpass the 2,130 mark but later fell with major tech stocks coming under heavy selling pressure.

Like other stock markets in the world, investors will likely take a wait-and-see stance ahead of U.S. President Donald Trump’s meeting with his Chinese counterpart, Xi Jinping, at the Group of 20 (G-20) summit in Osaka, Japan, which kicks off Friday.

“Some investors bought stocks with hopes for the U.S.-China summit, but more investors went for profit-taking,” said Seo Sang-young, an analyst at Kiwoom Securities.

Most large-cap shares finished in negative terrain, with pharmaceuticals and tech stocks leading the losses.

Market kingpin Samsung Electronics gained 0.22 percent to 45,600 won, but No. 2 chipmaker SK Hynix lost 0.3 percent to 66,700 won. LG Electronics shed 1.23 percent to 80,300 won, while its display-making affiliate LG Display dived 1.4 percent to 17,600 won.

Pharmaceutical giant Celltrion slid 0.24 percent to 208,000 won, while Samsung BioLogics plunged 2.64 percent to 313,000 won.

Auto shares ended mixed. The country’s leading automaker Hyundai Motor lost 0.7 percent to 141,500 won, but its smaller sister Kia Motors gained 0.23 percent to 43,500 won. Auto parts maker Hyundai Mobis advanced 1.31 percent to 232,000 won.

Chemical companies, however, were among gainers, with industry leader LG Chem inching up 1 percent to 352,000 won and Lotte Chemical advancing 1.18 percent to 257,000 won.

The secondary Kosdaq fell 7.67 points, or 1.07 percent, to close at 710.02. The index ended lower for three consecutive days as institutions and foreign investors mass offloaded pharmaceutical and tech stocks after seeing Nasdaq’s biotech shares nosedive 2.2 percent overnight.

The local currency closed at 1,156.20 won against the dollar, down 0.30 won from the previous session.

Bond prices, which move inversely to yields, closed lower. The yield on three-year bonds gained 3.8 basis points to 1.478 percent, and the return on 10-year bonds rose 2.1 basis points to 1.584 percent.

BY KO JUN-TAE, YONHAP [ko.juntae@joongang.co.kr]