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Roundup: S. Korean shares drop on worries about China's economy, Mideast

Xinhua, January 4, 2016 Adjust font size:

South Korean shares started the New Year in a negative territory on Monday due to worries about China's economy, the largest trading partner of South Korea.

The benchmark Korea Composite Stock Price Index (KOSPI) dropped 42.55 points, or 2.17 percent, to 1,918.76 at the close. Trading volume stood at 353.69 million shares worth 3.91 trillion won (3.29 billion U.S. dollars).

It marked the lowest close in about four months, posting the largest daily decline in more than four months.

Concerns spread over the Chinese economy as the manufacturing activity in the world's second-largest economy slowed down. Worries about geopolitical risk in the Middle East added woes to market sentiment.

Market watchers, however, noted that China's stock market rout would be temporary, forecasting the downward trend would not continue for long.

The future direction of the stock market would be determined by the earnings result of Samsung Electronics set to be announced on Friday, experts said.

Foreign and institutional investors sold shares worth 343 billion won and 157 billion won each, but retail investors bought a net 412 billion won worth of shares.

Most large-cap shares lost ground. Market bellwether Samsung Electronics dipped 4.4 percent, and top carmaker Hyundai Motor slumped 3.4 percent. Leading cosmetics maker AmorePacific lost 0.5 percent, and memory chip giant SK Hynix declined 2.0 percent.

Top life insurer Samsung Life Insurance shed 3.2 percent, and the most used web search engine Naver retreated 4 percent. The biggest auto parts maker Hyundai Mobis fell 3.4 percent, and the No.2 automaker Kia Motors lost 3.4 percent.

The South Korean currency finished at 1,187.7 won against the greenback, down 15.2 won from Wednesday's close. The local financial market was closed on Thursday and Friday for the New Year holiday.

Bond prices ended higher. Yields on the liquid three-year treasury notes fell 2.8 basis points to 1.634 percent, and the return on the benchmark 10-year government bonds dipped 3.7 basis points to 2.039 percent. Enditem