Seoul: Shares shed early gains amid mixed cues

[SEOUL] South Korean shares dipped on Wednesday as fears of Sino-US tension over China's crackdown in Hong Kong and fresh Covid-19 infections dented optimism about an economic recovery.

The Seoul stock market's benchmark Kospi closed down 1.63 points, or 0.08 per cent, at 2,106.70. The index rose as much as 1.2 per cent in early trade, tracking Wall Street gains overnight, as investors hoped for additional stimulus measures.

The index, however, reversed course to end lower following reports that the Hong Kong police arrested a man holding a flag advocating for independence, the first arrest under a sweeping national security law Beijing introduced overnight.

Business mood also soured after the United States recorded its biggest single-day spike since the pandemic began.

South Korean exports slumped more than expected in June, extending the double-digit contraction into a third month, as the pandemic and lockdown measures continued to dent global demand.

A separate private survey showed South Korea's manufacturing activity extended declines in June as the coronavirus impact on global demand protracted, while uncertainty over the future development and economic recovery further weighed on business outlook.

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Foreigners were net sellers of US$139.12 million worth of shares on the main board.

REUTERS