Kospi creeps down despite hope for bailout
Korean stocks inched down yesterday as institutional selling overshadowed revived hopes that U.S. lawmakers will salvage a rejected bailout plan, analysts said.The benchmark Kospi fell 8.39 points, or 0.6 percent, to 1,439.67. Volume was moderate at 299.4 million shares worth 3.8 trillion won ($3.22 billion), with losers outpacing gainers 405 to 387.
“The key stock index traded weaker amid lingering uncertainty at home and abroad. Although the Seoul bourse may undergo some volatility for the time being, the index would prop up the 1,400-point level,” said Bae Sung-young, an analyst at Hyundai Securities.
U.S. stocks soared Tuesday on renewed hopes that lawmakers will salvage a $700 billion proposal to rescue the teetering financial system, which was unexpectedly rejected on Monday. The Dow Jones industrial average rose 4.7 percent and the tech-dominated Nasdaq composite index jumped 4.97 percent. The U.S. Senate agreed to vote on Wednesday night (U.S. time) on the bailout plan, raising hopes for its passage.
“The outcome of the U.S. Senate’s vote on a revised bailout package and a rate decision by the European Central Bank slated for Thursday would be key events affecting the movement of the local bourse,” Bae said.
Tech bellwether Samsung Electronics fell 1.1 percent to 533,000 won on worries over its third-quarter earnings and consumer electronics giant LG Electronics shed 2.8 percent. Hynix Semiconductor gained 0.5 percent and LG Display added 0.8 percent.
Reversing earlier gains, No. 2 carmaker Kia Motors shed 2.4 percent despite reports that unionized workers at the automaker approved a revised wage deal, ending sporadic partial strikes. Its sister carmaker Hyundai Motor edged up 0.1 percent. No. 1 steelmaker Posco fell 1.2 percent and Hyundai Heavy Industries, the world’s largest shipbuilder, tumbled 2.9 percent on a bleak outlook for the shipbuilding industry.
But telecommunication shares, regarded as less vulnerable to economic cycles, gained ground. Top mobile carrier SK Telecom jumped 4.9 percent. No. 2 carrier KTF also advanced 1.4 percent.
Shinhan Finance Holdings lost 0.2 percent and Woori Finance Holdings retreated 0.8 percent. Korea Exchange Bank was also down 0.9 percent. Yonhap
with the Korea JoongAng Daily
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