You are here
Seoul: Shares skid to near 5-mth lows on oil slump; won nearly flat
[SEOUL] South Korean shares skidded to near 5-month lows early on Monday as energy and tech shares led declines on the back of an extended slump in oil prices and soft US economic data.
The Korea Composite Stock Price Index (KOSPI) was down 0.3 per cent at 1,872.40 points as of 0222 GMT, after falling as much as 1.3 per cent to its lowest intraday level since late August, 2015.
"The market is facing pressure from risk factors abroad, such as the extended fall in oil prices and persistent foreign selling of local stocks," said Cho Byung-hyun, a stock analyst at Yuanta Securities.
Mr Cho added that China's troubles may portend more weakness in markets, but Beijing's aggressive approach to managing trade in the yuan brought some respite.
International sanctions have been lifted, allowing Tehran to return to an already oversupplied oil market, with oil prices falling in anticipation of Iran's return.
US economic data on Friday disappointed investors, with an unexpected drop in retail sales, and industrial output declining again in December.
Tech and energy shares suffered the brunt of the selloff. Samsung Electronics Co Ltd shares lost 0.6 per cent. Chipmaker SK Hynix Inc slid 1.1 per cent, while LG Chem Ltd fell 2.7 per cent.
Meanwhile, the sub-index for construction firms gained as much as 2.6 per cent, after Iran's resumption of trade lifted expectations of South Korean companies winning more orders from Iran.
Foreign investors were poised to be net sellers for an eighth consecutive session, dumping a net 205.3 billion Korean won (S$243 million) worth of KOSPI shares by midday.
The South Korean won rose slightly near mid-session, tracking a firmer yuan.
The won was quoted at 1,212.9 per dollar, virtually unchanged from the previous close of 1,213.4.