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Kospi nose-dives nearly 3% as political upheaval plagues market

Published: 09 Dec. 2024, 16:53 Updated: 09 Dec. 2024, 19:12

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,360.58 points on Monday, down 2.78 percent, or 67.58 points, from the previous trading session. [YONHAP]

Shares tumbled by nearly 3 percent Monday amid deepening political upheaval as the opposition-led National Assembly is pushing for another impeachment motion against President Yoon Suk Yeol after a failed bid over the weekend. The won fell in value sharply against the dollar.

The Kospi plummeted 67.58 points, or 2.78 percent, to 2,360.58, the lowest since closing at 2,351.83 on Nov. 3 last year.

Trade volume was moderate at 583.08 million shares worth 9.84 trillion won ($6.85 billion), with losers overwhelming winners 865 to 60.

Retail investors dumped a net 888.9 billion won worth of shares, while institutions and foreign investors combined bought a net 794.3 billion won worth of shares.

Yoon has faced massive pressure to step down or face impeachment after last Tuesday's shocking martial law declaration, which was quickly overturned in the National Assembly.

On Saturday, the embattled president survived the impeachment motion brought forward by the opposition bloc after the bill was scrapped due to a lack of votes on the back of a boycott by the ruling party.

The opposition-led parliament is pushing for another impeachment motion against Yoon this week.

"The failure to pass an impeachment motion has prolonged political uncertainty," Kim Ji-won, an analyst at KB Securities, said, adding, "It will be necessary to prepare for the possibility of increased short-term volatility in the stock and foreign exchange markets."

Blue chips retreated across the board, with Samsung Electronics down 1.29 percent to 53,400 won and Hyundai Motor sliding 1.23 percent to 201,000 won.

Energy-related shares also retreated, with SK Innovation slumping 4.47 percent and Korea Zinc plunging 15.33 percent to 1,535,000 won.

Financial shares also lost ground, with KB Financial dropping 2.93 percent to 82,800 won and Shinhan Financial down 1.17 percent to 50,700 won.

The won was trading at 1,437 against the greenback as of 3:30 p.m., up 17.8 won from the previous session.

Bond prices, which move inversely to yields, closed higher. Three-year government bond yields fell 2.8 basis points to 2.603 percent, while the return on the benchmark 10-year U.S. government bonds fell 0.2 basis points to 4.167 percent.

BY KAYA SELBY, YONHAP [[email protected]]