Shrinking surplus prompts drop in Kospi
The benchmark Kospi ended 1.41 percent lower at 1,991.54 yesterday, hit by a shrinking surplus and a stronger won versus the yen and the strengthening dollar.Foreign investors net sold 210.4 billion won ($197.9 million) while retail investors purchased 144.4 billion won. Institutional investors bought 44.4 billion won.
The Kospi’s major players in most sectors suffered losses. Samsung Electronics slipped 2.36 percent to 1,156,000 won, and rival LG Electronics plunged 4.41 percent.
Shares of securities companies, which tend to be vulnerable to market conditions, sank further. Samsung Securities dropped 5.33 percent to 41,750 won, while NH Investment and Securities fell 5 percent to 7,600 won. Hyundai Securities, SK Securities and Daishin Securities tumbled more than 4 percent.
Posco, the nation’s largest steelmaker, plunged 3.35 percent to 317,500 won, and Hyundai Steel dropped 4.31 percent. However, Dongbu Steel rebounded 4.93 percent on expectations that Dongbu Group will undergo a debt restructuring plan smoothly.
Naver, Korea’s largest search engine, ended 0.37 lower at 750,000 won, while Daum, the second-largest portal site, gained 5.58 percent after an announcement that it will formally launch the integrated corporation Daum Kakao.
SK Hynix closed down 0.75 percent to 46,400 won. LG Chem also followed a losing streak, with its shares down 2.54 percent at 249,000, while Lotte Chem dropped 2.49 percent.
Amid downbeat performances, telecommunications companies managed to pull out gains, with SK Telecom advancing 2.41 percent and KT 0.44 percent.
The won slumped 0.7 percent to 1,062.49. The yield on Korea’s 2.75 percent notes due June 2017 declined seven basis points, or 0.07 percentage point, to a record-low 2.24 percent amid speculation the central bank will cut rates.
“The tolerance for currency appreciation has greatly diminished in Korea,” said Marcelo Assalin, who oversees $7.5 billion of emerging-market debt in Atlanta for ING Investment Management. “We should see a more interventionist bias going forward.”
BY Park Eun-jee, bloomberg [ejpark@joongang.co.kr]
with the Korea JoongAng Daily
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