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(LEAD) S. Korean stocks tumble on foreign selling

All News 16:37 July 03, 2019

(ATTN: ADDS bond yields at bottom)

SEOUL, July 3 (Yonhap) -- South Korean stocks closed sharply lower Wednesday as foreign investors turned to selling amid fears of slower-than-anticipated growth for Asia's fourth-largest economy. The local currency lost further ground against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) lost 26 points, or 1.23 percent, to close at 2,096.02. Trading volume was moderate at 510 million shares worth about 4.5 trillion won, with losers outnumbering gainers 634 to 201.

Foreigners offloaded a net 109.7 billion won (US$93.6 million) worth of local shares, ending their buying streak of six consecutive sessions, while institutions purchased a net 156.7 billion won. Individuals sold a net 44 billion won.

"South Korean stocks got off to a weak start due to the U.S. tariffs against EU products, while the report from Moody's that Japan's export restrictions against shipments to South Korea may adversely affect the credit ratings of semiconductor producers also weighed on investor sentiments," said Seo Sang-young, an analyst from Kiwoom Securities.

Tokyo announced tougher restrictions on South Korea-bound shipments of tech materials that are used to produce semiconductors and display panels Monday, prompting concerns for Seoul's already struggling exports.

South Korea's exports have dipped for seven consecutive months as of June, largely led by drops in shipments of semiconductors, its key export item.

Earlier in the day, the Seoul government revised down its growth outlook to a range of 2.4 to 2.5 percent from the 2.7 percent forecast six months earlier.

Most large caps closed in negative terrain with market bellwether Samsung Electronics plunging 1.84 percent to 45,400 won.

No. 2 chipmaker SK hynix tumbled 3.22 percent to 69,100 won, while top automaker Hyundai Motor lost 0.73 percent to 136,000 won.

Top pharmaceutical firm Celltrion advanced 0.49 percent to 206,000 won, but steel giant POSCO slipped 1.01 percent to 245,000 won.

The local currency closed at 1,171.30 against the U.S. dollar, down 5.30 won from the previous session.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys lost 3.4 basis points to 1.429 percent, and the return on benchmark five-year government bonds shed 4.5 basis points to 1.459 percent.


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