Shares dip 2% on oil slump, eurozone woes

South Korean stocks dropped almost 2 percent Tuesday as a prolonged slump in oil prices and revived woes over the eurozone economy prompted broad market sell-offs, analysts said. The South Korean won rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index shed 33.3 points, or 1.74 percent, to 1,882.45. Trading volume was moderate at 299 million shares worth 4.66 trillion won ($4.24 billion), with losers beating gainers 577 to 233.

Major market heavyweights remained in negative terrain with tech, shipbuilders and utility stocks leading the overall decline.

Analysts said a continued fall in oil prices and renewed concerns over a possible exit of Greece from the eurozone weighed on the local stock market.

On Monday, global equity markets dipped as Greek stocks sank more than five percent on speculation over the country leaving the eurozone. Oil prices stayed below the $50-level per barrel, prompting worries that the slump is pointing to a weaker global economy.

“The Greek issue, coupled with concerns over deflation stemming from a slide in oil prices, is sending the local stock market lower,” said Kim Sung-hwan, an analyst at Bookook Securities.

“Throughout this week, investors will take to the sidelines amid increased volatility.”

Top market cap Samsung Electronics shed 2.85 percent to close at 1,295,000 won ahead of its fourth-quarter earnings estimate due out later this week. SK hynix, a global chipmaker, also fell 0.31 percent to end at 47,500 won.

Automakers remained in negative terrain with industry leader Hyundai Motor losing 2.08 percent to end at 164,500 won, and its smaller affiliate Kia Motors declining 1.54 percent to end at 51,200 won.

Their parent Hyundai Motor Group announced during market hours it would invest 81 trillion won by 2018 to raise its competitiveness. (Yonhap)