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(LEAD) Seoul stocks close at annual low on Turkey crisis

All Headlines 16:41 August 13, 2018

(ATTN: ADDS bond yields at bottom; CHANGES photo)

SEOUL, Aug. 13 (Yonhap) -- South Korean stocks sank to an annual low on Monday as investors feared financial woes in Turkey could cause a ripple effect throughout the world, analysts here said. The South Korean won dropped against the greenback.

The benchmark Korea Composite Stock Price Index (KOSPI) shed 34.34 points, or 1.50 percent, to close at 2,248.45, its lowest since the 2,241.24 logged on May 4, 2017. Trading volume was moderate at 330.54 million shares worth 5.85 trillion won (US$5.16 billion), with losers far outnumbering gainers 776 to 83.

The fall, shared by other parts of the world, came as Turkey's lira has effectively collapsed since last week, after U.S. President Donald Trump slapped stiff tariffs on Turkish steel apparently in response to Ankara's decision to extend the detention of Andrew Brunson, an American pastor accused of espionage. This year, the Turkish currency nosedived more than 40 percent.

"Investors fretted about fallouts from the extreme currency volatility in emerging economies which have already been weighed down by the stronger U.S. dollars," said Kim Byeong-yeon, an expert at NH Investment and Securities.

"Chances are slim for this case to have longer-term impacts, but it will delay the serious comeback of foreign investors to the local equity market," he noted.

Foreigners offloaded a net 172 billion won worth of local shares, while institutions and retail investors picked up 13.3 billion won and 102.8 billion won worth of stocks, respectively.

Most blue chips drifted lower, with tech and bio shares dragging down the index.

Top cap Samsung Electronics lost 0.77 percent to end at 45,050 won, and LG Chem skidded 1.87 percent to 368,000 won.

No. 1 steelmaker POSCO retreated 2.74 percent to 319,000 won, and top automaker Hyundai Motor lost 1.98 percent to 123,500 won.

Major bio firm Celltrion dipped 4.23 percent to 260,500 won after Goldman Sachs painted a bleak picture regarding Celltrion's U.S. market share. The negative market prospect also affected other bio shares, causing Samsung BioLogics, a biopharmaceutical affiliate of Samsung Group, to drop 3.88 percent to end at 446,000 won.

Securities and insurers also lost ground, with Samsung Life Insurance decreasing 3.09 percent to 94,000 won and Mirae Asset Daewoo diving 4.15 percent to 7,620 won.

The South Korean currency closed at 1,133.90 won against the U.S. dollar, down 5.00 won from the previous trading session.

Bond prices, which move inversely to yields, ended lower. The yield on three-year Treasurys added 1.1 basis points to 2.051 percent, and the return on benchmark five-year government bonds rose 1.7 basis points to 2.280 percent.

(LEAD) Seoul stocks close at annual low on Turkey crisis - 1

graceoh@yna.co.kr
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