Roundup: S. Korean shares tumble on geopolitical risks, global routs

South Korean shares tumbled on Thursday, the first trading day after the Lunar New Year holiday, due to a surge in geopolitical risks on the Korean peninsula and global stock market routs.

The benchmark Korea Composite Stock Price Index (KOSPI) tumbled 56.25 points, or 2.93 percent, to 1,861.54 at the close.

Trading volume stood at 381.1 million shares worth 4.64 trillion won (3.86 billion U.S. dollars).

The daily decline of 2.93 percent was the highest fall in almost four years as geopolitical risks escalated on the Korean peninsula due to the Democratic People's Republic of Korea (DPRK)'s rocket launch on Sunday just a month after its fourth nuclear test.

Seoul decided to shut down a jointly-run factory park with the DPRK as part of punitive measures against the rocket launch, dragging down stocks relevant to inter-Korean economic cooperation.

Global stock market routs, especially in Japan, in the past three days contributed to the weakening of market sentiment.

The South Korean financial market was closed from Monday to Wednesday for the Lunar New Year holiday.

Foreign investors reduced holdings of local stocks by 174 billion won, leading the market decline.

Institutional and individual investors bought shares worth 69 billion won and 43 billion won each, falling short of stopping the stock rout.

Large-cap shares lost ground. Market bellwether Samsung Electronics shrank 2.8 percent, and the most-used search engine Naver plunged 5.3 percent.

Leading chemical firm LG Chem tumbled 4.3 percent, and memory chip giant SK Hynix sank 3.4 percent. The biggest cosmetics maker Amore Pacific declined 3.1 percent.

The South Korean currency finished at 1,202.5 won against the greenback, down 5.1 won from Friday's close.

Bond prices ended higher. Yields on the liquid three-year treasury notes dipped 5.6 basis points to 1.450 percent, and the return on the benchmark 10-year government bonds dropped 11.6 basis points to 1.766 percent. Enditem