Kospi drops 1.2% on third day of decline

Korean stocks fell 1.2 percent yesterday ahead of a European Union summit and amid weak U.S. and Chinese economic data, analysts said.

The benchmark Kospi plunged 22.01 points to 1,825.38, marking the third straight session of decline. Trading volume was very light at 277 million shares worth 4.08 trillion won ($3.51 billion), with losers outpacing gainers 501 to 316.

“There is persistent uncertainty surrounding the EU summit that will have to tackle such tough questions as the surge in Spain’s borrowing costs and Greece’s debt problems,” said Lee Sang-jae, an analyst at Hyundai Securities.

He added that weak U.S. hiring and manufacturing sector data and indications that the Chinese economy is slowing down further weighed down the local bourse.

Song Chang-sung, an analyst at Hanyang Securities, said investor concerns were rising over the ability of the euro zone to deal with its outstanding issues. European leaders are expected to meet on Thursday and Friday.

Others said that predictions of poor performance by the world’s memory chipmakers in the second quarter affected Kospi prices.

Most big-cap shares in electronics, autos, steel and heavy industries lost ground with some gains reported for chemicals.

Market bellwether Samsung Electronics nosedived 4.2 percent to 1,132,000 won, with leading carmaker Hyundai Motor losing 0.8 percent to 241,000 won. Shares of SK Hynix fell 4.4 percent to 23,050 won, with the losing streak extended to a third straight day as foreign investors unloaded their shares. Goldman Sachs has sold a total of more than 3 million shares in the past three trading days.

No. 2 carmaker Kia Motors dipped 0.3 percent to 77,300 won, and memory chip manufacturer SK hynix plunged 4.4 percent to 23,500 won.

Top steelmaker Posco lost 1.4 percent to 365,500 won, with Hyundai Heavy Industries, the world’s largest shipmaker, slipping 1.5 percent to 258,500 won.

LG Chem gained 1.1 percent to 281,500 won, and top auto parts maker Hyundai Mobis went up 0.7 percent to 280,500 won,

The local currency finished at 1,161.7 won to the U.S. greenback, down 4.9 won from Friday’s close.

Yonhap