Published : 2013-10-10 15:38
Updated : 2013-10-10 15:38
South Korean stocks closed almost flat Thursday as concerns over a possible default of the United States government dented investor sentiment, analysts said. The local currency gained against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) shed 1.36 points, or 0.07 percent, to finish at 2,001.40. Trading volume was low at 218.7 million shares worth 3.85 trillion won ($3.58 billion) with losers outpacing gainers 459 to 324.
Analysts said Seoul shares closed flat as the congressional impasse in the U.S. continued to dent investor sentiment amid the rising woes that its government could face a first-ever default soon.
The U.S. government headed into its first shutdown in 17 years on Oct. 1, keeping only essential services intact, after Congress failed to pass a spending bill for the fiscal year of 2014 amid disputes over the controversial health care reform.
"The benchmark KOSPI will remain around the 2,000-mark down the road and take a leap when the U.S. political tension is eased," said Kim Hak-gyun, an analyst at KDB Daewoo Securities.
Analysts added the decline was limited after reports that U.S. President Barack Obama will select Janet Yellen to head the Federal Reserve after its current head Ben Bernanke finishes his term, which abated uncertainties over its tapering of quantitative easing.
Yellen is known to have supported the Fed's economic stimulus moves, which added to investors' outlook that the U.S. central bank would maintain its monetary policy for the time being, they added.
Foreigners purchased more shares than they sold for the 30th consecutive session at a net 140 billion won, and individuals also scooped up a net 160 billion won. Institutions, in contrast, offloaded a net 291.4 billion won.
Builders closed lower, with Hyundai Engineering & Construction falling 0.79 percent to 62,500 won and Daelim Industrial moving down 2.81 percent to 96,700 won. Daewoo Engineering & Construction lost 2 percent to 8,330 won.
Logistics firms also lost ground, with Hyundai Glovis moving down 0.46 percent to 215,000 won and Hyundai Merchant Marine decreasing 0.97 percent to 15,350 won. CJ Korea Express shed 1.28 percent to 92,800 won.
In contrast, tech shares closed bullish, with leading chipmaker SK hynix adding 2.6 percent to 33,600 won and local handset maker LG Electronics moving up 2.67 percent. Flat panel maker LG Display gained 0.21 percent to 24,250 won.
Retailers also traded higher, with Lotte Shopping increasing 3.32 percent to 388,500 won and Daewoo International, a major local trading company, rising 0.14 percent to 36,850 won. Discount store chain E-Mart gained 0.44 percent to 229,000 won.
The local currency ended at 1,073.60 won against the greenback, up 0.10 won from Tuesday's close. The South Korean financial markets were closed on Wednesday for Hangeul Day, which commemorates the invention and proclamation of the Korean alphabet in 1446. (Yonhap News)