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Seoul: Stocks pull back after solid rally, won edges down
[SEOUL] South Korean shares declined early on Tuesday as investors took a breather after the market's record-breaking rally this month, which was fuelled in part by hopes for strong corporate earnings for the April-June quarter.
The Korea Composite Stock Price Index (Kospi) was down 0.6 per cent at 2,338.10 points as of 0246 GMT. The benchmark has risen 6 per cent this month alone, and on Monday it scored record high.
"Though it is a sudden drop, it is not that surprising considering how much the Kospi has risen recently," said Cho Byung-Hyun, a stock analyst at Yuanta Securities.
The index touched 2,371.67 on Monday, the highest intraday level in history.
"Today's drop does not mean that the Kospi's upbeat trend has reversed. The fundamentals are strong and since market players are expecting strong economic data later this week, the Kospi is likely to rebound," Mr Cho added.
Mr Cho was referring to exports data due later this week, with expectations a recent uptick in shipments will continue.
Offshore investors were set to be net sellers, offloading 16.4 billion Korean won (S$20.26 million) worth of Kospi shares near mid-session.
Market heavyweight Samsung Electronics lost 2.4 per cent while web portal Naver was down nearly one per cent.
The South Korean won edged down on low-volume trading amid a broadly stronger US dollar. Many traders were also cautious ahead of a batch of economic data slated to be released later this week, including US jobs as well as exports data at home.
The won stood at 1,123.8 to the US dollar, down 0.2 per cent compared to Monday's close of 1,121.7.
June futures on three-year treasury bonds gained 0.05 point to 109.56.