Market falls only by a tick on stronger won
Korean stocks closed marginally lower yesterday as investor sentiment was lifted by eased currency concerns, analysts said. The local currency jumped against the U.S. dollar on a verbal intervention by foreign exchange authorities.The benchmark Kospi fell 0.46 points, or 0.03 percent, to 1,426.43. Volume was moderate at 368 million shares worth 4.76 trillion won ($4.21 billion), with winners outpacing losers, 540 to 279.
“Investors seemed to take comfort from the surging won and stabilizing financial markets,” said Lee Sun-yup, an analyst at Goodmorning Shinhan Securities. “Especially, retailers snapped up recently beaten-down shares, ending their selling spree of four straight days.”
The key index rose as high as 1,436.62 at one point in the morning session, but foreign sell-offs weighed the market, which reduced out earlier gains, analysts said.
Major large-cap shares gained ground, with financial and construction shares driving the market higher. Builders pared gains made in the previous session on expectations that the government is pushing to ease property-related regulations. Daewoo Engineering and Construction fell 3.57 percent to 12,150 won, while smaller Hyundai Engineering and Construction remained flat at 59,500 won. Tech and steel shares weighed on the market. Tech bellwether Samsung Electronics plunged 2.47 percent to 514,000 won, and smaller chipmaker Hynix Semiconductor lost 6.54 percent to 17,850 won. Steelmaking giant Posco fell 3.92 percent to 453,000 won.
The won surged after the government’s verbal intervention to stabilize the fluctuating won-dollar exchange rate. The won closed at 1,129.00 won to the U.S. dollar, up 19.5 won from Wednesday’s close.
The local currency fell to a four-year low against the dollar on Tuesday and the local stock market fell to an 18-month low on speculation that a massive foreign capital flight from the bond market may send Asia’s fourth-largest economy into a crisis. The Korean won has lost around 18 percent against the U.S. dollar this year and nearly 6 percent in the past four trading sessions, as demand for the greenback remained strong despite interventions by foreign exchange authorities.
Bond prices rose on eased currency woes. Yonhap
with the Korea JoongAng Daily
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