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(LEAD) Seoul stocks dip more than 4 pct to 6-month low on virus fears, oil crash

All News 17:01 March 09, 2020

(ATTN: CHANGES photo; ADDS more details in paras 9-12, decliners in 15th para, bond yields at bottom)

SEOUL, March 9 (Yonhap) -- South Korean shares tumbled by more than 4 percent on Monday as foreign investors went on a massive selling spree in the face of growing coronavirus concerns and a crash in oil prices. The Korean won sharply fell against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) plunged 85.45 points, or 4.2 percent, to 1,954.77, its lowest point since August 29 last year, when the index closed at 1,933.41 points.

Trading volume was heavy at 6 million shares worth 8.7 trillion won (US$7.2 billion), with losers far outnumbering gainers 866 to 33.

This photo taken on March 9, 2020, shows the dealing room of KEB Hana Bank in central Seoul, when the KOSPI ended down 4.2 percent at 1,954.77. (Yonhap)

The market rout came as COVID-19 disease continues to spread across the world, while Saudi Arabia, the world's largest oil exporter, has triggered an oil price war with Russia by slashing its selling prices and pledging to unleash its pent-up supply to markets already suffering lower demand amid an economic slowdown.

Saudi Arabia's move is aimed at punishing Russia as it balked at production cuts proposed by the Organization of the Petroleum Exporting Countries (OPEC) amid the spreading coronavirus outbreak, analysts said.

"The newly added uncertainties jolted investor confidence and sparked fears of a worldwide recession, resulting in crashes in global equities," NH Investment & Securities Co. analyst Noh Dong-kil said.

As of 3 p.m., Brent crude futures had fallen by 26 percent to $33 a barrel and U.S. West Texas Intermediate (WTI) crude was down 28 percent to $29 a barrel, according to the Korea National Oil Corp.

North Korea's launching of three unidentified projectiles off its east coast early on Monday had little impact on local stocks, analysts said.

Foreigners and institutions sold a combined 1.34 trillion won worth of stocks, a record high since the country's bourse operator began tracking the data in 1999.

Foreigners were net sellers for a third consecutive session, dumping a combined 2.02 trillion won amid concerns over the fast-spreading COVID-19.

Since the first confirmed case of the new coronavirus here on Jan. 20, foreigners have sold a net 7.77 trillion won worth of local stocks.

Retail investors, meanwhile, scooped up a net 1.27 trillion won worth of local stocks on Monday, hoping for an overall rebound. Since Jan. 20, they bought a net 11.1 trillion won worth of stocks.

South Korea had reported a total of 7,382 confirmed coronavirus cases and 51 deaths as of Monday.

Most large-cap stocks retreated across the board.

Market bellwether Samsung Electronics Co. plunged 4.1 percent to 54,200 won, No. 2 chipmaker SK hynix plummeted 6.2 percent to 86,900 won, top carmaker Hyundai Motor Co. shed 5.9 percent to close at 104,000 won, and Hanjin KAL Corp., parent firm of Korean Air Lines Co., was down 10 percent at 63,400 won.

Refiners and petrochemical firms fell sharply due to falling oil prices. Leading refiner SK Innovation Co. plunged 8.2 percent to 99,100 won, No. 3 refiner S-Oil Corp. declined 9.8 percent to 58,000 won, and Lotte Chemical Corp. was down 2.6 percent at 171,500 won.

Among gainers, state-run utility Korea Electric Power Corp. rose 8.1 percent to 22,800 won.

The local currency closed at 1,204.20 won against the U.S. dollar, down 11.90 won from the previous session's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys fell 4.0 basis points to 1.038 percent, and the return on the benchmark five-year government bond declined 5.5 basis points to 1.127 percent.

kyongae.choi@yna.co.kr
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