Seoul: Stocks end flat on caution over exports, Q2 earnings

[SEOUL] South Korean shares ended flat on Monday, after trading in a narrow range, as investors were cautious about sluggish exports and trends emerging from corporate earnings. The won weakened, while the benchmark bond yield rose.

The Seoul stock market's main Kospi index closed down 1.02 points or 0.05 per cent at 2,093.34.

South Korea's exports for the first 20 days of this month fell a sharp 13.6 per cent from a year earlier, customs data showed, led by poor semiconductor shipments and underscoring continued weakness in global demand.

Hyundai Motor posted its steepest quarterly net profit gain in over seven years, as a weaker local currency helped lift US income, while new models boosted domestic sales. Its shares closed down 1.1 per cent.

SK Hynix is scheduled to post its second-quarter results on Thursday, while Samsung Electronics is due to announce its earnings on July 31.

Japan's strategy on trade restrictions against South Korea is expected to stay the same after the upper house election in Japan, said Lee Young-gon, an analyst at Hana Financial Investment. Sluggish trade data also weighed on sentiment though it was in line with expectations, he added.

Japanese Prime Minister Shinzo Abe's ruling bloc won a solid majority in an upper house election on Sunday, but his coalition and allies fell short of a two-thirds majority needed to begin revising the pacifist constitution.

Foreigners were net buyers of 204.6 billion won worth of shares on the main board. The won was quoted at 1,178.3 per dollar on the onshore settlement platform, 0.32 per cent lower than its previous close at 1,174.5.

In offshore trading, the won was quoted at 1,178.4 per US dollar, down 0.3 per cent from the previous day, while in non-deliverable forward trading, its one-month contract was quoted at 1,177.2 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.45 per cent, after US stocks closed down on Friday. Japanese stocks fell 0.23 per cent.

The Kospi has risen 2.56 per cent so far this year, and gained 1.1 per cent in the previous 30 trading sessions.

The current price-to-earnings ratio is 12.10, the dividend yield is 1.28 per cent and the market capitalisation is 1,242.04 trillion won.

Trading volume during the session on the Kospi index was 314.98 million shares and, of the total traded issues of 894, the number of advancing shares was 320.

The won has lost 5.3 per cent against the US dollar so far this year.

In money and debt markets, September futures on three-year treasury bonds fell 0.01 point to 110.75, while the three-month Certificate of Deposit rate was quoted at 1.59 per cent.

The most liquid theree-year South Korean treasury bond yield rose by 1.0 basis point to 1.335 per cent, while the benchmark 10-year yield rose by 1.2 basis points to 1.466 per cent.

REUTERS