Market slips a notch on U.S. uncertainties
Seoul shares finished lower yesterday after a turbulent session as anxieties over the health of the U.S. financial market prompted foreign investors to continue their blue-chip selling spree here, analysts said.The benchmark Kospi shed 1.93 points, or 0.1 percent, to 1,507.4. The Kospi, which gained more than 1 percent in early trading, went through steep fluctuations, dropping to 1,489.86, the lowest level for this year so far, in mid-day trading.
Volume was moderate at 292.8 million shares worth 4.9 trillion won ($4.9 billion), with losers outpacing gainers, 406 to 385.
“A significant drop in oil prices on Tuesday didn’t seem to comfort unnerved foreign investors still unsure of how to interpret mixed signals within the U.S. Federal Reserve chief’s congressional testimony,” said Kim Seung-han, an analyst at CJ Investment and Securities. On Tuesday, Fed Chairman Ben Bernanke said in a congressional testimony that the outlook for economic growth and inflation was unusually uncertain, but also underlined that the banking system is well-capitalized.
Finance stocks were hit hard by the lingering anxiety from the credit crunch. Leading brokerage Samsung Securities shed 1.3 percent. Top lender Kookmin Bank plunged 9.9 percent, a record decline. The company said it will buy back no more than 15 percent of outstanding shares in an offer to shareholders who oppose the bank’s plan to set up a holding company.
“The announcement signals the holding company plan may not come through if opponents exceed the 15 percent stake, further clouding prospects for the restructuring plan,” said Mo Jae-sung, who helps manage the equivalent of $1 billion at Hanwha Investment Trust Management.
Builders also extended their losses from the previous session. Top builder Daewoo Engineering and Construction tumbled 7.6 percent. GS Engineering dropped 4.3 percent
“The government has said repeatedly it will focus on slowing inflation, making it more difficult for it to spend money on infrastructure projects,” said Harry Jun, an analyst at Hanwha Securities.
Tech exporters, however, added momentum. Market heavyweight Samsung Electronics advanced 1.5 percent and its consumer electronics rival LG Electronics also added 1.4 percent. Yonhap, Bloomberg
with the Korea JoongAng Daily
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