Seoul: Stocks end lower on Ukraine crisis; won at weakest since May 2020
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[SEOUL] South Korean shares closed lower on Monday (Mar 7) to post their biggest fall in a week-and-a-half, as the war in Ukraine and calls for harsher sanctions against Russia stoked fears of a stagflationary shock that would hurt the European region.
The Korean won weakened to its lowest close since late-May 2020 as investors pulled out money from riskier assets, while the benchmark bond yield rose.
The Kospi closed down 62.12 points, or 2.29 per cent, at 2,651.31 - the sharpest fall since Feb 24.
Leading the declines, chip giants Samsung Electronics and SK Hynix fell 1.96 per cent and 4.02 per cent, respectively, while LG Chem dropped 3.93 per cent.
Persistent fighting blocked efforts to evacuate 200,000 people from the besieged Ukrainian city of Mariupol for a second day in a row on Sunday as Russian President Vladimir Putin vowed to press ahead with his offensive, which he said was going to plan, unless Kyiv surrendered.
South Korea toughened its financial sanctions against Russia by banning transactions with Russia's central bank, following similar moves by the US and the European Union.
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Foreigners were net sellers of 1.17 trillion won (S$1.3 billion) worth of shares on the main board.
The won was ended at 1,227.1 per dollar on the onshore settlement platform, the lowest since May 29, 2020 and 1.05 per cent lower than its previous close.
The foreign exchange authority was spotted selling dollars on Monday to limit a decline in the won currency, traders said, after a warning that it was monitoring speculative movement in the offshore market.
In offshore trading, the won was quoted at 1,226.8 per dollar, down 0.8 per cent, while in non-deliverable forward trading its 1-month contract was quoted at 1,228.3.
In money and debt markets, March futures on 3-year treasury bonds fell 0.2 point to 107.95.
The most liquid 3-year Korean treasury bond yield rose by 6 basis points to 2.276 per cent, while the benchmark 10-year yield rose by 4 basis points to 2.702 per cent. REUTERS
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