Poor earnings reports push stocks down

Finance

Published: 24 Jan. 2014, 21:39

Poor earnings reports push stocks down

Korean stocks fell yesterday, mainly due to lower-than-expected earnings from major companies, analysts said. The Kospi shed 7.03 points, or 0.36 percent, to close at 1,940.56, its lowest level in two weeks. Foreigners sold more than 154 billion won ($143 million) worth of shares, while institutional investors were net sellers.

Samsung Electronics’ record performance in 2013 pushed up its stock 0.62 percent to 1.307 million won. Its rival, LG Electronics, jumped 0.29 percent to 69,800 won.

Automobile shares declined on the news that Hyundai Motor and Kia Motors’ profits dropped after their poor fourth-quarter earnings. Hyundai Motor dropped 1.72 percent to 228,000 won, while Kia plunged 1.13 percent to 52,700 won. Ssangyong Motor slipped 1.75 percent to 7,860 won.

Construction stocks were also weak with concerns about builders’ fourth-quarter performances. Daelim Industrial lost 3.33 percent to 81,400 won. The company announced on Thursday that it posted operating losses of 319.6 billion won.

Samsung C&T dropped 0.87 percent to 56,800 won. The nation’s second-largest builder said its operating profit in the fourth quarter was down 38.6 percent year-on-year to 125.8 billion won. GS E&C also plunged 8.26 percent to 33,000 won, while Daewoo E&C slid 1.13 percent to 6,100 won. Shipbuilders fell, too. Hyundai Heavy Industries slid 2.54 percent to 230,000 won, while Daewoo Shipbuilding and Marine Engineering shed 0.42 percent to 35,950 won.

LG Household and Healthcare, the nation’s leading home appliance maker, plunged 12.79 percent to 491,000 won, the first time in three months that its share value has gone below 500,000 won. Analysts said the company’s conservative business forecast for this year caused concerns for investors.

In contrast, Hyundai Hysco, the steelmaker relisted on the stock market after its cold rolled steel plate business was merged with its affiliate, Hyundai Steel, gained 9.81 percent to 41,400 won.

Financial groups’ stocks rose after forecasts of good fourth-quarter performance. Shinhan Financial Group jumped 1.96 percent to 44,200 won, while Hana Financial Group rose 1.76 percent to 40,550 won. Woori Financial Holdings climbed 2.06 percent to 12,400 won.

BY JOO KYUNG-DON [kjoo@joongang.co.kr]