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Seoul shares down for 2nd day on concerns of delayed recovery

All News 15:59 February 10, 2020

SEOUL, Feb. 10 (Yonhap) -- South Korean stocks closed lower Monday, falling for the second straight session, amid concerns that the new coronavirus outbreak may delay the country's economic recovery. The local currency lost ground slightly against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) lost 10.88 points, or 0.49 percent, to close at 2,201.07. Trading volume was moderate at 600 million shares worth 5.33 trillion won (US$4.49 billion), with losers outnumbering gainers 423 to 395.

The index plunged more than 1 percent in the morning session, losing 30.25 points, or 1.37 percent, in the first 15 minutes of trading.

The coronavirus outbreak has yet to have any direct impact on the local economy, but analysts here believe it will inevitably weigh down on its recovery by undermining local consumption and limiting exports.

"The concerns over the coronavirus mainly stem from the fact that the number of fatalities has exceeded that from the SARS outbreak in 2003 and that the economic fallout from the outbreak may expand," Meritz Securities economist Lee Seung-hoon said.

"The rise in the number of infected people in China began to slow down over the weekend, but people fear the number may begin to rise again when companies (factories) resume their operations," Lee added.

South Korea has so far reported 27 confirmed cases of the new coronavirus, with no additional case reported since Sunday.

Many, however, believe the mass outbreak in China, with more than 40,000 confirmed cases, will likely lead to a continued decline in South Korea's exports, as China alone accounts for nearly 20 percent of the country's outbound shipments.

"The concerns of an economic slowdown are expected to continue for some time with global firms in China extending their suspension of factories and shops despite their scheduled resumption of business today," NH Futures analyst Kim Tae-hyun said.

"Our economy too faces concerns of a downturn as its automobile and electronic makers are reported to be experiencing production disruptions due to a shortage of (China-made) parts," Kim said.

In Seoul, foreign investors offloaded a net 304 billion won, while individuals scooped up a net 435.4 billion won. Institutions dumped a net 165 billion won.

Large caps were mixed by the close of trading.

Market kingpin Samsung Electronics fell 1.16 percent to 59,700 won, and No. 2 chipmaker SK hynix shed 0.50 percent to reach 98,800 won.

Leading pharmaceutical company Samsung BioLogics jumped 2.12 percent to 530,000 won, but top automaker Hyundai motor slipped 0.76 percent to 130,000 won.

The won closed at 1,187.05 won against the greenback, down 0.55 won from the previous session's close.


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