Anticipated tightening in China chills market
Seoul’s main stock market ended sharply lower yesterday, on program-based selling ahead of the simultaneous expiration of future and option contracts today. The benchmark Kospi closed at 1,813.52, down 33.84 points, or 1.8 percent.“Investors are reluctant to buy stocks, not only because of uncertainties before the simultaneous expiration of futures and options but also because of concerns about China’s possible tightening policy,” said Sung Jin-kyung, an analyst at Daishin Securities.
Beijing reported on Tuesday that the nation’s consumer prices jumped 6.5 percent last month over a year earlier, the highest in more than 10 years, strengthening the expectation that it would take action to curb inflation such as an interest rate raise.
Korean steelmakers and shipbuilders, whose major market is China, fell on the worries yesterday. Posco sank 4.2 percent to 564,000 won ($605). Hyundai Heavy Industries lost 3.3 percent. Samsung Heavy Industries plunged 6.5 percent.
Technology shares were also weak. Samsung Electronics slid 1.2 percent. Hynix Semiconductor fell 0.6 percent. LG.Philips LCD declined 1 percent.
Hyundai Merchant Marine tumbled 10.7 percent after the news that the Financial Supervisory Service is investigating allegations of stock manipulation in the second-largest shipping line in Korea.
Trade volume was moderate at 429.1 million shares worth 5 trillion won ($5.3 billion). Losing shares overwhelmed gainers, 602 to 234.
The secondary Kosdaq market also declined. The index closed at 757.83, down 9.49 points or 1.2 percent. NHN gained 1 percent, and Daum Communications jumped 5.3 percent. About 810 million shares worth 2.2 trillion won were traded. Falling shares led advancers, 697 to 254.
By Moon So-young Staff Writer [symoon@joongang.co.kr]
with the Korea JoongAng Daily
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