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Seoul: Stocks, won slip on weak commodity prices

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[SEOUL] South Korean shares opened higher but quickly retreated to turn lower on Tuesday morning as weak commodity prices and concerns about China spooked investors.

Overnight, crude oil futures tumbled 6 per cent, reaching their lowest in nearly seven years, after Opec failed to address a growing supply glut.

Data, released early on Tuesday, showed China's exports fell 3.7 per cent from a year earlier in November in yuan-denominated terms, while imports fell 5.6 per cent.

The Korea Composite Stock Price Index (KOSPI) was down 0.4 per cent at 1,955.75 points as of 0241 GMT, set to fall for five straight days. Declining issues nearly outnumbered advancers by 3-to-1.

"Oil prices came off lower than people expected, causing anxiety to sweep across market sentiment," said Lee Kyung-min, a stock analyst at Daishin Securities.

Most shares in the Samsung group of stocks rose, with Samsung Engineering Co Ltd leading the group, up 15.8 per cent as of 0241 GMT, buoyed by a pledge from the heir of family-run conglomerate to back the engineering company's planned 1.2 trillion won (S$1.44 billion) rights issue.

Refinery shares fell after oil prices plunged 5 per cent overnight. SK Innovation Co Ltd slid 1.6 per cent and S-Oil Corp lost 1.6 per cent.

Meanwhile, foreigners were set to be net sellers for a fifth straight session, offloading a net 76 billion Korean won worth of KOSPI shares by midday.

In the currency market, the South Korean won was quoted at 1,174.6 per dollar, down 0.6 per cent, compared with the previous close of 1,168.2.

December futures on three-year treasury bonds gained 0.1 point to 109.27.

REUTERS