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Seoul: Stocks post worst fall in a month on Europe lockdown concerns

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[SEOUL] South Korean shares dropped 2.4 per cent on Tuesday, logging the sharpest decline in a month, as investors shunned riskier assets on concerns about new coronavirus restrictions in Europe. Both the won and the benchmark bond yield weakened.

The benchmark Kospi extended losses to a second session to close down 56.80 points or 2.38 per cent at 2,332.59.

With Covid-19 infections on the rise in Europe, countries including Denmark, Greece and England have tightened restrictions, spurring fears about fresh lockdowns that could further pressure the economy.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 1.26 per cent.

Most of South Korea's market heavyweights slumped, with the two largest - Samsung Electronics and SK Hynix - falling 1.7 per cent and 3.8 per cent, respectively.

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Shares in South Korean biomedical firm LabGenomics dropped to a two-month low, after reports said a US lab had stopped using the company's Covid-19 test kits due to reliability concerns.

Meanwhile, LG Chem, a Tesla supplier, soared as much as 5.1 per cent ahead of the electric-car maker's "Battery Day" event on hopes for increased battery cell purchases from Tesla.

The Bank of Korea said it sees no need to downgrade its current economic growth projections, even after the government imposed tougher social distancing measures to curb a spike in coronavirus cases in late August.

South Korea reported 61 new coronavirus cases as of Monday midnight, lower than 70 a day earlier.

Foreigners were net sellers of 229.6 billion won (S$268.1 million) worth of shares on the main board.

The won ended trading at 1,165.0 per US dollar on the onshore settlement platform, 0.60 per cent lower than its previous close.

The most liquid three-year Korean treasury bond yield fell by 0.7 basis point to 0.897 per cent.

REUTERS

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