Hyundai Leads Markets Lower

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Hyundai Leads Markets Lower

Share prices on the Korea Stock Exchange closed lower Wednesday on the overnight fall in the U.S. Nasdaq futures index and the financial woes of Hyundai Engineering & Construction Co.

The Korea Composite Stock Price Index shed 4.11points, or 0.77 percent, to 528.79. Trading volume was heavy at 403 million shares valued at 1.51 trillion won ($1.16 billion).

Decliners overwhelmed gainers 610 to 194, with 63 other stocks unchanged. Fourteen stocks tumbled by the daily limit of 15 percent, while 10 stocks rose by that limit.

The benchmark index opened higher but lost ground on profit taking and concerns about the future of Korea's largest builder.

Shares in Hyundai Construction plunged by the daily limit for a second day to 1,050 won on news that its capital was wiped out by last year's loss of nearly 3 trillion. The government and creditors are moving to convert the builder's debts into equity to keep it afloat.

Korea Exchange Bank, Hyundai Engineering's main creditor, slid 10.05 percent to 2,020 won.

Other Hyundai Group shares also headed south, with Hyundai Merchant Marine Co. losing 4 percent and Hyundai Corp. down by the daily limit.

Adding to the day's losses, key large-capitalized issues ended lower. SK Telecom Co. sank 4.40 percent to a one-year low of 184,500 won, after it announced that it and its affiliate, Shinsegi Telecom Co., would not accept new subscribers from April 1 to reduce their combined market share to 50 percent by the end of June to meet government requirements. Pohang Iron & Steel Co. slipped 0.22 percent to 91,300 won, while Samsung Electronics Co. was unchanged at 207,500 won.

The Kosdaq market also closed in negative territory on local institutional and retail selling. Its composite index dropped 1.28 point, or 1.78 percent, to 70.58.

LG Telecom Co. added 3.03 percent to 5,440 won on expectation that it may enter the third-generation mobile phone business. Korea Telecom Freetel was off 2.07 percent at 40,200 won.

by Kim Hyun-chul

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