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Mideast tensions send Seoul stocks sharply lower, Korean won sinks

All News 11:33 January 08, 2020

SEOUL, Jan. 8 (Yonhap) -- South Korean stocks extended losses late Wednesday morning on escalating military tensions in the Middle East, while the local currency also plunged against the U.S. dollar, with investors apparently seeking safer assets.

The benchmark Korea Composite Stock Price Index (KOSPI) lost 23.08 points, or 1.06 percent, to 2,152.46 as of 11:20 a.m.

The index opened sharply lower, losing 21.97 points, or 1.01 percent, in the first 15 minutes of trading.

The sharp drop followed reports of Iran's missile attacks against U.S. military bases in Iraq, further heightening tensions in the Middle East that began late last week when the U.S. killed a top Iranian general in a drone strike.

Washington has warned of additional strikes against Iranian targets in case of retaliation by the Middle Eastern country.

Analysts here, however, insisted the clash is unlikely to lead to a full-fledged conflict.

"Iran has staged an attack against the U.S., but President Donald Trump is unlikely to further expand the conflict with Iran ahead of the U.S. election," Meritz Securities analyst Yoon Yeo-sam said, adding the conflict will likely be short-lived.

Most large caps were in negative terrain, though market kingpin Samsung Electronics surged 1.79 percent on its market estimate-beating fourth-quarter earnings.

No. 2 chipmaker SK hynix spiked 5.43 percent, but top automaker Hyundai Motor plunged 1.73 percent, with its smaller affiliate Kia Motors also tumbling 2.26 percent.

The local currency was trading at 1,174.30 won against the U.S. dollar, sharply down 7.90 won from the previous session's close.


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