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Seoul shares down 0.36 pct ahead of BOK meeting


South Korean stocks closed 0.36 percent lower Tuesday as investors took a wait-and-see approach ahead of the central bank's monetary policy meeting slated for Thursday, analysts said. The local currency gained against the U.S. dollar.
   
The benchmark Korea Composite Stock Price Index (KOSPI) shed 7.13 points to finish at 1,954.35. Trading volume was low at 295 million shares worth 3.5 trillion won (US$3.2 billion) with gainers outnumbering decliners 437 to 368.
   
"Seoul shares traded lower as investors sat on the sidelines concerning the central bank's monetary policy meeting scheduled this week," said Kim Sung-hwan, an analyst at Bookook Securities Co.   

Analysts are divided over whether South Korea's central bank will cut the key interest rate for May, but more experts are betting on a rate freeze, citing prospects for the economic recovery, a poll showed Tuesday.
  
Out of 23 analysts, 12 experts predicted that the Bank of Korea (BOK) will freeze the benchmark seven-day repo rate at 2.75 percent for the seventh straight month on Thursday, according to a survey by Yonhap Infomax.
   
South Korea's central bank froze the key interest rate for the sixth straight month in April amid some signs of the economic recovery, rejecting the government's call to join the stimulus drive.
  
"The upcoming expiration of options slated for this week also added to the decline," Kim added. "Foreign investors also continued to offload local shares."
   
Institutional investors purchased a net 77.8 billion won and individuals sold a net 153.9 billion won. In contrast, foreigners net-sold shares worth 215.2 billion own.
   
Namyang Dairy Products Co., a local manufacturer of milk powder products, shed 8.59 percent to 1,021,000 won for the fourth consecutive trading session after media reports that the firm took advantage of its distributors with unlawful acts.
   
Carmakers closed bearish amid the weak yen, with No. 1 player Hyundai Motor falling 2.26 percent to 194,500 won and Kia Motors losing 1.97 percent to 54,700 won.
   
Tech blue chips also lost ground, with market behemoth Samsung
Electronics falling 1.39 percent to 1,493,000 won and top chipmaker SK hynix losing 1.04 percent to 28,600 won. LG Electronics moved down 0.82 percent to 84,600 won.
   
In contrast, mobile carriers gathered ground, with leading SK Telecom climbing 3.39 percent to 213,500 won and KT adding 1.31 percent to 38,800 won. LG Uplus, the smallest player, rose 3.46 percent to 11,950 won.
   
Builders closed bullish, with Hyundai Engineering & Construction rising 0.85 percent to 59,200 won and Daewoo Engineering & Construction moving up 0.92 percent to 7,680 won.  

The local currency ended at 1,091.40 won against the greenback, up 3.10 won from Monday's close, as exporters offloaded U.S. dollars, dealers said. (Yonhap News)

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