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(LEAD) Seoul stocks dip almost 2 pct on Brexit woes

All News 15:46 June 13, 2016

(ATTN: ADDS bond yields at bottom)

SEOUL, June 13 (Yonhap) -- South Korean stocks dipped by almost 2 percent to a two-week low on Monday as investors scrambled for safe havens ahead of the Federal Reserve meeting slated this week and rising concerns over Britain's exit from the European Union. The Korean won sharply lost against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) plunged 38.57 points, or 1.91 percent, to close at 1,979.06, marking the biggest intraday loss in four months. Trade volume was moderate at 437.22 million shares worth 4.53 trillion won (US$3.86 billion), with losers far outnumbering winners 675 to 156.

Foreign investors dumped local shares ahead of central bank meetings in the United States and Japan amid lingering worries over the global economy and the possible impact of a British exit, called Brexit, from the EU.

Two polls released over the weekend showed that British public opinion is too close to call on whether the country should maintain its EU membership, with many voters still undecided ahead of the June 23 referendum.

"Asian markets slumped as investors preferred safer assets on rising Brexit concerns," Kim Dae-ho, an analyst at KTB Investment & Securities, said. "The Korean market is coupling with other emerging markets, being affected by growing risks in the global economy."

Foreigners and institutions dumped a net 147.83 billion and 73.7 billion won, respectively. Retail investors bought a net 173.5 billion won for bargain hunting.

Market bellwether Samsung Electronics sank 2.49 percent to 1,371,000 won as investors tried to lock in from last week's sharp rally, weighing down the overall index.

Securities shares were among the biggest losers as investors were spooked over the rising uncertainties in the global economy.

Mirae Asset Daewoo Securities retreated 3.85 percent to 23,750 won, and Samsung Securities went down 3.12 percent to 35,650 won.

Lotte Group shares suffered a setback as prosecutors widened their probe into South Korea's fifth-largest conglomerate on lobbying and slush fund allegations, jeopardizing its core business projects.

Lotte Shopping, the group's key retail unit, dived 5.38 percent to 211,000 won, and Lotte Chemical, a chemical unit, dropped 3.91 percent to 258,000 won after withdrawing from bidding for U.S.-based Axiall Corp.

The local currency closed at 1,173.4 won against the U.S. dollar, down 7.9 won from the previous session's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasury she d 1.1 basis points at 1.311 percent, and the return on the benchmark five-year government bond declined 2.5 basis points to 1.394 percent.


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