Seoul: Shares drop most in two weeks on virus mutation fears

[SEOUL] South Korean shares declined the most in two weeks on Tuesday as foreign investors took profits on rising concerns over a new fast-spreading strain of the coronavirus in Britain and fresh Covid-related curbs at home. The Korean won weakened, while the benchmark bond yield fell.

By 0632 GMT, the benchmark Kospi fell 44.97 points or 1.6 per cent to 2,733.68, its biggest daily decline since Dec 8.

Foreigners were net sellers of 149.6 billion won worth of shares on the main board.

Investors are increasingly cashing in on a recent rally, fuelled by optimism over a US stimulus package and progress on vaccines, as fears deepen over the risks from mutation of the coronavirus, said Kiwoom Securities' analyst Seo Sang Young.

South Korea moved to shut down all ski resorts and winter tourist spots to curb a third wave of Covid-19 cases in the capital city.

Meanwhile, several countries closed their borders to Britain over fears of a highly infectious new coronavirus strain.

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The won was quoted at 1,107.4 per US dollar on the onshore settlement platform, 0.4 per cent lower than its previous close at 1,102.7.

In offshore trading, the won was quoted at 1,107.5 per US dollar, down 0.4 per cent from the previous day, while in non-deliverable forward trading its one-month contract was quoted at 1,106.1.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.5 per cent. The Kospi has risen 24.39 per cent so far this year, and gained 13.5 per cent in the previous 30 trading sessions.

The won has gained 4.4 per cent against the US dollar so far this year.

In money and debt markets, March futures on three-year treasury bonds rose 0.08 points to 111.58.

The most liquid three-year Korean treasury bond yield fell by 1.5 basis points to 0.945 per cent, while the benchmark 10-year yield fell by 2.3 basis points to 1.656 per cent.

REUTERS