Seoul: Stocks end lower as Middle East tensions hit risk appetite

[SEOUL] South Korean stocks closed down nearly 1 per cent on Monday after the US and Iran exchanged threats, fuelling a rush to safe-haven assets. The won and the benchmark bond yield dropped.

The Kospi fell 21.39 points, or 0.98 per cent, to 2,155.07 - its lowest close since Dec 12.

The Middle East issue was the major factor, said Park Seok-hyun, an analyst at KTB Securities. A rise of oil prices might weigh on private consumption, he added.

US President Donald Trump threatened to impose sanctions on Iraq and retaliate against Iran if it strikes back after the killing of its top commander. His threat against Iraq comes after its parliament voted in favour of expelling US troops.

Foreigners were net buyers of 99.1 billion won (S$114.4 million) worth of shares on the main board.

The won was quoted at 1,172.1 per US dollar on the onshore settlement platform, 0.43 per cent lower than its previous close at 1,167.1.

In offshore trading, the won was quoted at 1,171.8 per US dollar, down 0.6 per cent from the previous day, while in non-deliverable forward trading, its one-month contract was quoted at 1,170.0 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 1 per cent after US stocks dipped on Friday. Japanese stocks closed down 1.91 per cent.

The Kospi has fallen 1.94 per cent so far this year, but gained 1.1 per cent in the previous 30 trading sessions.

The trading volume during the session on the KOSPI index was 587.47 million shares and, of the total traded issues of 909, the number of advancing shares was 99.

The won has lost 1.3 per cent against the dollar so far this year.

In money and debt markets, March futures on three-year treasury bonds fell 0.04 points to 110.79, while the three-month Certificate of Deposit rate was quoted at 1.50 per cent in late afternoon trade.

The most liquid three-year South Korean treasury bond yield rose by 0.3 basis points to 1.272 per cent in late afternoon trade, while the benchmark 10-year yield fell by 2.0 basis points to 1.532 per cent.

REUTERS