Seoul: Shares end at over 6-week low on Europe energy worries
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SOUTH Korean shares reversed early gains to end at a more than 6-week low on Monday (Sep 5), hit by the dollar’s strength on concerns over Europe’s energy struggle. The won hit a more than 13-year low, while the benchmark bond yield fell.
The benchmark Kospi ended down 5.73 points or 0.24 per cent at 2,403.68, reversing an early gain of as much as 0.64 per cent, in its lowest closing level since Jul 22. The index fell for the third straight session.
Russia kept one of its main gas supply routes to Europe shut on Saturday, stoking fears of winter fuel shortages.
It pulled down the stocks with increasing worries about Europe’s recession and global inflation pressure, said Choi Yoo-june, analyst at Shinhan Financial Investment.
South Korean finance minister Choo Kyung-ho said that the authorities would take action in a pre-emptive manner if necessary to stabilise local financial markets, where volatility has increased due to external factors.
Among heavyweights, technology giant Samsung Electronics fell 0.7 per cent and peer SK Hynix lost 0.65 per cent, but battery maker LG Energy Solution inched up 0.21 per cent.
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Biopharmaceutical shares led losses, with Samsung Biologics and Celltrion down more than 2 per cent each, while SK Bioscience slumped 4.5 per cent.
Foreigners were net sellers of shares worth 57.8 billion won (S$59.2 million) on the main board.
The won ended down 0.64 per cent at 1,371.4 per dollar on the onshore settlement platform, after touching its lowest since early April 2009 at 1,375.
Market participants suspected the authorities of selling dollars to ease the won’s fall.
In offshore trading, the won was quoted down 0.8 per cent at 1,371.9 per dollar, while in non-deliverable forward trading its 1-month contract was quoted at 1,370.9.
In money and debt markets, September futures on 3-year treasury bonds rose 0.17 point to 103.72 in late afternoon trade.
The most liquid 3-year Korean treasury bond yield fell by 2.8 basis points to 3.65 per cent, while the benchmark 10-year yield fell by 4.7 basis points to 3.698 per cent.. REUTERS
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