Seoul shares sink to near 4-month low on China stock rout

South Korean stocks plunged more than 2 percent to a near four-month low Monday on the first trading session of 2016, as China's stock market crash and concerns over fourth-quarter corporate earnings dented investor sentiment here.

The local currency sharply fell against the greenback, also flirting with an over three-month low.

The benchmark Korea Composite Stock Price Index lost 42.55 points, or 2.17 percent, to end at 1,918.76, the lowest since Sept. 8, when the comparable figure was 1,878.68 points.

Trade volume was moderate at 355 million shares worth 3.92 trillion won ($3.3 billion), with losers beating winners 686 to 155.

China's stock market crashed more than 5 percent earlier in the day, with the global stock market also suffering losses.

The Shanghai Composite Index plunged 6.85 percent to end at 3,296.66 points, the lowest in nearly three months, after trading was halted earlier in the day to stem a further slide.

China's manufacturing sector activity contracted for a fifth consecutive month in December, a private survey showed on Monday, rekindling concerns that the world's second-largest economy may face a slowdown soon.

On Thursday, U.S. stocks also shed more than 1 percent, weighed down by a slump in tech stocks.

Investors awaited the release of fourth-quarter earnings by major listed firms, while a slowing economy and an industrywide slump cast a cloud over their performance.

"Institutional investors' massive selling also weighed down the local stock market after they bought massive stocks before the end of last year," said Han Yo-seop, an analyst at Daewoo Securities.

Foreigners sold a net 157 billion won, while individuals bought a net 412 billion won. Institutions offloaded a net 343 billion won.

Most market heavyweights remained in negative terrain with tech and automakers leading the market decline.

Top market cap Samsung Electronics fell 4.37 percent to end at 1,205,000 won, and global chipmaker SK hynix dropped 1.95 percent to finish at 30,150 won.

No. 1 automaker Hyundai Motor went down 3.36 percent to end at 144,000 won, and its smaller affiliate Kia Motors declined 3.42 percent to end at 50,800 won.

In contrast, LG Chem, the country's top chemicals maker, advanced 3.96 percent to finish at 341,500 won.

The local currency ended at 1,187.70 won against the greenback, down 15.2 won from the previous session's close, the lowest since Sept. 25, when the currency closed at 1,194.70 won to the dollar.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys lost 2.8 basis points to 1.605 percent, and the return on the benchmark five-year government bonds shed 3.6 basis points to 1.778 percent. (Yonhap)