Investors dumping Samsung

Samsung Electronics, Korea’s flagship blue chip, is among the companies hardest hit by the recent market plunge. The value of Samsung Electronics shares, which reached a yearly high of 637,000 won ($537) in April, continued a free fall yesterday to 458,000, a 6.82 percent drop from Friday. Foreign investors, holding 58 percent of Samsung Electronics total shares, unloaded 88,000 shares of the chipmaker, valued at 41.2 billion won, on the Korean stock market. “With the recent fall in the market, investors are trying to grab profits,” said Hong Sung-guk at Daewoo Securities. “Samsung Electronics is the best share with the most liquidity, triggering foreign investors’ sales.” Min Hoo-sik of Dongwon Securities said a negative outlook on the Korean economy had propelled retail investors’ massive dumping of Samsung Electronics shares. “Investors selling their stakes in Samsung Electronics are worried that the economy in the third quarter will suffer a hard landing and the performance of DRAM semiconductors and cellular phones, Samsung’s core products, would decrease in the later half,” said Mr. Min. Merrill Lynch said the key reason behind the fall in Samsung shares are newly emerging risks for Korean technology exports: China’s economic retrenchment, and a U.S. interest rate raise that may reduce DRAM semiconductor and cellular phone sales overseas. Last month, Merrill Lynch predicted that Samsung’s shares would hit 950,000 won this year. by Kim Dong-ho, Lee Ho-jeong