Lehman’s demise shocks Korean markets

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Lehman’s demise shocks Korean markets

Korean stocks nosedived more than 6 percent to an 18-month low yesterday on panic selling following the demise of Lehman Brothers Holdings, analysts said.

The local currency plunged to the lowest level against the U.S. dollar since 2004.

“The bankruptcy filing of Lehman Brothers sent shock waves across global markets, with indexes in developed markets having fallen around 4 percent on average on Monday,” said Lim Dong-min an analyst at Dongbu Securities.

Finance stocks sank deep in the red, with top lender Kookmin Bank tumbling 7.99 percent and leading brokerage Mirae Asset Securities plummeting 14.69 percent. Leading non-life insurer Samsung Fire and Marine shed 2.23 percent.

Tech exporters, construction and shipyard shares were also beaten. Market heavyweight Samsung Electronics slid 3.31 percent to 525,000 won ($452.5) and Samsung Electronics’ crosstown rival LG Electronics declined 9.2 percent, the lowest since Feb. 13.

Panel giant LG Display tumbled 9.72 percent dragged by its recently-slashed earnings outlooks.

Top builder Daewoo Engineering and Construction tumbled 10.22 percent and Hyundai Heavy Industries, the world’s largest shipyard, fell 9.58 percent.

Doosan Heavy Industries and Construction also shed 7.41 percent, and Samsung Heavy Industries also lost 7.96 percent.

The nation’s top 10 listed-firms also went on the decline. Among the top 10, Asia’s third-biggest steelmaker Posco lost 5.86 percent.

The local currency closed at a 49-month low of 1,160.0 won to the U.S. dollar, plunging 50.9 won from Friday’s close, as foreign investors rushed to purchase the dollar after dumping shares in the local bourse, dealers said. Korea’s financial markets were closed Monday for the Chuseok holiday. Yonhap

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