Stocks retreat on tech firm earnings concerns

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Stocks retreat on tech firm earnings concerns

Stocks dropped 0.88 percent on Wednesday to end a three-day winning streak, as major tech firms came under strong selling pressure amid earnings concerns.

The won plummeted to the lowest level in almost 19 months.


After the choppy trading, the benchmark Kospi shed 19.48 points to close at 2,201.03. Trade volume was moderate at 565 million shares worth 6 trillion won ($5.2 billion), with losers far outnumbering gainers 584 to 251.

The local stock market opened higher, tracking overnight gains on Wall Street as both the S&P 500 and the Nasdaq composite index set fresh records on upbeat first-quarter corporate earnings.

Yet the Kospi fell into negative territory as investors dumped top-cap tech shares, such as Samsung Electronics and SK Hynix.

Institutional investors went on a selling binge by offloading 420 billion won. Meanwhile, retail and foreign investors scooped up a net 400.6 billion won and 23.4 billion won, respectively.

“Many top-cap shares, such as Samsung Electronics and SK Hynix, dropped on concerns over earnings reports and the information technology industry,” said Lee Young-gon, a Hana Financial Investment researcher.

Samsung Electronics ended at 44,750 won, down 1 percent from the previous session’s close, and SK Hynix, a major chipmaker, lost 3.09 percent to 78,500 won.

LG Display, a major flat panel maker, sank 6.35 percent to end at 19,900 won on news that its losses widened in the first quarter from a year ago due to low LCD panel prices.

Bio shares also closed lower, with Samsung BioLogics, a biopharmaceutical affiliate of Samsung Group, losing 2.29 percent to end at 362,000 won. Celltrion was down 1.58 percent to 218,000 won.

In contrast, Hyundai Motor moved up 1.84 percent to 138,500 won after saying that its first-quarter net profit jumped 30 percent from a year earlier. Kia Motors added 1.74 percent to 43,900 won.

The secondary Kosdaq lost 3.60 points, or 0.47 percent, to close at 757.82.

The won closed at 1,150.9 won against the dollar, up 9.1 won from the previous session’s close, hitting the lowest level since July 11, 2017, when the corresponding figure was 1,151.1 won.

Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds lost 1.9 basis points to 1.749 percent, and the return on 10-year bonds shed 1.1 basis points to 1.912 percent.

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