Korean stocks sank 1.38 percent Thursday as investors stepped to the sidelines after the previous session’s rally amid lingering market uncertainty, analysts said. The local currency fell against the U.S. dollar.
Following a 1.13 percent jump a day earlier, the benchmark Korea Composite Stock Price Index tumbled 27.87 points to 1,997.45. Trading volume was heavy at 689.3 million shares worth 6.8 trillion won ($6 billion), with decliners outnumbering gainers 548 to 288.
“Nagging eurozone woes and easing hopes for a third round of quantitative easing in the United States prompted investors to take a breather after Wednesday’s rally,” said Park Sung-hoon, an analyst at Woori Investment & Securities Co.
Park said overall liquidity conditions remain favorable, but added the Iran sanctions issue may dent market sentiment if global oil prices surge excessively.
Foreigners offloaded a net 69.4 billion won worth of shares, snapping their eight-session buying streak. Institutions also scaled back their holdings but retail investors opted to buy.
Shares lost ground across the board with most large caps ending in negative territory. Top shipyard Hyundai Heavy Industries slumped 4.65 percent to 318,000 won and leading steelmaker POSCO fell 2.4 percent to 406,000 won. (Yonhap News)
Banks and brokerages ended bearish after Moody’s Investors Service put ratings of 114 financial institutions in 16 European countries on review for possible downgrades. No. 3 banking group Shinhan Financial Group lost 3.23 percent to 43,400 won and industry leader Samsung Securities sank 4.02 percent to 62,100 won.
In contrast, defensive shares closed higher, with confectionery maker Orion gaining 3.66 percent to 652,000 won.
State-run gas utility Korea Gas jumped 3.09 percent to 41,700 won following a discovery of additional natural gas at a Mozambique mine, in which it owns a 10 percent stake.
The local currency closed at 1,131.9 won to the greenback, down 10.4 won from Wednesday’s close, as hopes fade for further U.S. monetary easing and concern continues over the eurozone debt problem, dealers said. (Yonhap News)
