Tech giants stumble as chip market takes a hit

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Tech giants stumble as chip market takes a hit


Korean stocks retreated Friday as tech heavyweights slumped on concerns that a two-year memory chip boom may be losing steam amid lingering uncertainties over trade disputes between the United States and China. The Korean won strengthened against the greenback.

The benchmark Kospi dropped 6.03 points, or 0.26 percent, to close at 2,281.58. Trade volume was moderate at 6.09 trillion won ($5.43 billion).

Offshore investors remained net sellers for a third consecutive day on concerns that the Trump administration might slap additional tariffs on $200 billion of Chinese imports after a public comment period ended Thursday at midnight. China warned it would retaliate if Washington implemented any new tariffs.

“The losses in U.S. memory chip manufacturers in the previous day also affected local tech stocks,” said Kim Byung-yeon, an analyst at NH Investment & Securities.

Foreign investors dumped a net 771.6 billion won worth of local stocks. Institutions bought a net 500.9 billion won and retail investors purchased a net 224.5 billion won.

Tech shares extended losses on concerns over prospects of weak demand for memory chips.

Market kingpin Samsung Electronics declined 2.6 percent to 44,900 won, and chip giant SK Hynix dipped 3.68 percent to 75,900 won.

Auto shares were mixed following news reports that Elliott Management, a New York-based activist fund, called for Hyundai Motor to merge some key units to boost shareholder value and improve the group’s structure last month.

Hyundai Motor, the nation’s leading automaker, slipped 0.75 percent to 133,000 won. In contrast, its sister company Kia Motors moved up 1.78 percent to 34,250 won, and its parts maker Hyundai Mobis increased 2.38 percent to 237,000 won.

Construction shares rallied on hopes for cross-border development projects, with the leaders of the two Koreas set to meet for a summit in Pyongyang in less than two weeks.

Hyundai Engineering & Construction rose 4.6 percent to 63,700 won, and GS Engineering & Construction gained 3.89 percent to 49,400 won.

The secondary Kosdaq inched up 3.68 points, or 0.45 percent, to 818.86, as foreign and individual investors went bargain shopping.

The local currency closed at 1,122.8 won against the U.S. dollar, down 1.2 won from Thursday’s close.

Bond prices ended mixed. The yield on three-year bonds gained 0.7 basis points to 1.92 percent, and the return on 10-year bonds shed 0.6 basis points to 2.27 percent.

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