Shares held back by trade and Brexit concerns

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Shares held back by trade and Brexit concerns


Stocks retreated Wednesday on uncertainties over trade talks between the United States and China and uncertainties related to Britain’s exit from the European Union (EU), analysts said. The Korean won fell against the dollar.

The benchmark Kospi shed 8.77 points, or 0.41 percent, to close at 2,148.41.

Trading volume was light at 279.22 million shares worth 3.98 trillion won ($3.51 billion), with gainers and losers roughly tied at 401 to 400.

Market sentiment was downbeat after British premier Theresa May’s plan to leave the EU was nixed in a parliamentary showdown.

Robert Lighthizer, the U.S. trade representative, raised doubts Tuesday that a trade agreement with China is coming soon, saying that “major issues” must still be resolved.

“Investor sentiment is down due to prolonged trade talks, also coupled with the collapsed summit between the United States and North Korea in Hanoi,” Noh Dong-kil, an analyst at Shinhan Investment, said. “Uncertainties in Europe and signs of a global economic slowdown are also considered negative factors for the local stock market.”

Institutions dumped a net 205.5 billion won worth of local stocks to drag down the broader market. Foreign and retail investors bought a net 102.5 billion and 95.7 billion won, respectively, to pare back some of the losses.

Tech shares were down. Samsung Electronics decreased 1.79 percent to 43,850 won, and chipmaker SK Hynix declined 1.33 percent to 66,800 won.

Hyundai Motor sank 2.39 percent to 122,500 won, and LG Chem skidded 0.68 percent to 363,000 won.

Posco rose 1.59 percent to 255,500 won, and cosmetic maker LG Household & Health Care jumped 4.09 percent to 1,323,000 won.

The Kosdaq rose 0.13 points, or 0.02 percent, to end the session at 754.89. The index finished virtually unchanged as early increases on gains in the Nasdaq the day before were offset by sudden decreases in Chinese stocks. Sillajen sank 7.45 percent to 68,300 won, but YG Entertainment ended its losing streak by gaining 5.15 percent to 37,750 won. Super Apex Business Group gained 29.94 percent to 1,250 won.

The Korean won closed at 1,132.6 won against the dollar, up 2.8 won from Tuesday.

Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds lost 1.5 basis points to 1.795 percent, and the return on 10-year bonds lost 2.5 basis points to 1.966 percent.

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