FINANCE

Seoul stocks edge down over Hong Kong security law

By Yonhap
  • Published : Jul 1, 2020 - 16:11
  • Updated : Jul 2, 2020 - 16:01

(Yonhap)

South Korean shares closed a tad lower Wednesday, erasing earlier gains amid rising US-China tensions over a new security law in Hong Kong imposed by China's central government. The Korean won fell against the US dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) lost 1.63 points, or 0.08 percent, to close at 2,106.70. Trading volume was moderate at about 1.1 billion shares worth some 10.1 trillion won ($8.4 billion), with losers outnumbering gainers 482 to 356.

Foreigners sold a net 166 billion won, extending a selling streak to a third session. Institutions bought a net 152 billion won, with retail investors purchasing a net 10 billion won.

The index got off to a strong start on hopes for an economic rebound but turned south in the afternoon amid concerns over the latest developments in Sino-American political frictions over Hong Kong.

"Despite positive leads from the US economic indices, concerns have been building up over the US-China political tensions," Lee Kyung-min, an analyst at Daeshin Securities, said.

"The index swung to losses in the afternoon following some related events, such as China's complaint that the US is crossing the line over the Hong Kong national security law issue," he added.

China's complaint came hours after US President Donald Trump wrote on Twitter that he's "more and more angry at China" over the new coronavirus pandemic.

Market concerns also grew as South Korea's exports dropped for a fourth consecutive month in June. The US and China are South Korea's two largest trade partners.

In Seoul, market heavyweights closed mixed.

Market bellwether Samsung Electronics slid 0.38 percent to 52,600 won, while No. 2 chipmaker SK hynix added 0.24 percent to 85,300 won.

Top pharmaceutical firm Samsung BioLogics tumbled 2.97 percent to 752,000 won, while leading chemical maker LG Chem gained 0.20 percent to 491,500 won.

The local currency closed at 1,203.40 won against the US dollar, down 0.40 won from the previous session's close.

Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys rose 0.5 basis point to 0.847 percent, and the return on the benchmark five-year government bond added 2.1 basis points to 1.132 percent. (Yonhap)