Shares edge lower on investor wariness

South Korean stocks closed 0.24 percent lower Tuesday as investors became wary ahead of key events at home and abroad, analysts said. The local currency declined against the U.S. dollar.

The benchmark Korea Composite Stock Price Index lost 4.7 points to 1,920. Trading volume was heavy at 703.2 million shares worth 4.25 trillion won ($3.77 billion), with losers outpacing winners 457 to 339.

“Investors sat on the sidelines to see what policymakers will decide regarding economy-boosting plans later this week,” said analyst Um Tae-woong of Bookook Securities Co. “Until these events, there’s no big momentum to drive up or pull down the key index.”

The U.S. Federal Reserve is to meet on Wednesday and Thursday amid anticipation it will announce a third round of bond purchases to spur the slowing economy.

Germany’s Federal Constitutional Court is due on Wednesday to rule on the country’s participation in a European fund to offer loans to member states and buy bonds to lower borrowing costs.

“Both events are expected to meet market expectations. But investors still remain cautious until the actual results come out as the impact of unexpected outcomes will be huge,” said Um.

The analyst also said the KOSPI will start to gather ground after option and futures expirations slated for Thursday.

Most shares traded in negative territory, led by losses in banks, autos and builders.

Woori Finance Holdings, the biggest financial group by assets, fell 0.45 percent to 11,100 won, with Hana Financial Group dropping 1.57 percent to 34,450 won.

Leading automaker Hyundai Motor dipped 0.63 percent to 235,000 won and its smaller affiliate Kia Motors skidded 0.27 percent to 72,700 won, after they announced a promotion plan to offer sales incentives.

Top builder Hyundai Engineering & Construction lost 0.6 percent to 66,600 won and GS Engineering & Construction retreated 1.57 percent to 75,300 won.

(Yonhap News)