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Seoul: Stocks drop as chipmakers fall; Trump-Xi meeting awaited
[SEOUL] South Korea's Kospi stock index closed lower on Friday, weighed down by chipmakers, as global investors awaited the high-stakes trade talks between Chinese President Xi Jinping and US President Donald Trump this weekend. The Korean won edged down, while bond yields rose.
South Korea's central bank raised its policy interest rate on Friday for the first time in a year in a widely expected move aimed mainly at containing a boom in parts of the country's property market. Analysts said heightened global markets turmoil over the past few months has made it difficult for the Bank of Korea (BOK) to find the perfect timing to adjust policy.
The Kospi closed down 17.24 points or 0.82 per cent at 2,096.86. The benchmark index rose 1.9 per cent on a weekly basis, while it rose 3.3 per cent on a monthly basis, posting the biggest monthly gain since January.
The Kospi fell as semiconductor shares dipped towards the end of the session, said Kim Ji-hyung, an analyst at Hanyang Securities. BOK's rate hike had limited effect as it was widely expected, Mr Kim added.
South Korea's chip giants Samsung Electronics and SK Hynix closed down 3.0 per cent and 2.7 per cent, respectively. World Semiconductor Trade Statistics (WSTS) said in a report that it forecasts the memory segment to "show a slightly negative growth after the extraordinary growth in 2018."
Hyundai Motor Co closed up 7.0 per cent, posting its biggest gain since March 21, 2017, after the company said it would buy back 255 billion won (S$311.6 million) worth of common and preferred stocks to stabilise its stock prices and boost investor returns.
Samsung Electronics' supplier Toptec Co Ltd plunged 19.6 per cent after South Korean prosecutors on Thursday charged the chief executive and eight employees of the company for selling information earlier this year about Samsung's organic light-emitting diode (Oled) panels.
South Korea's construction machinery manufacturer Doosan Bobcat Inc hit a near four-month low as parent company Doosan Infracore Co Ltd said it sold shares worth 149.1 billion won in Doosan Bobcat. Doosan Bobcat ended 7.3 per cent lower.
The won was quoted at 1,121.2 per US dollar on the onshore settlement platform, 0.18 per cent weaker than its previous close at 1,119.2. For the week, the currency rose 0.8 per cent, while it jumped 1.6 per cent on a monthly basis, hitting its biggest monthly gain since March 31.
In offshore trading, the won was quoted at 1,120.67 per US dollar, down 0.37 per cent from the previous day, while in one-year non-deliverable forwards it was being asked at 1,100.35 per dollar.
The US dollar has risen 5.09 per cent against the won this year.