KOSPI Dips Below 2,000 on Wall Street Declines
By Park Hyong-ki
Staff Reporter
Seoul shares fell sharply Thursday as investors rushed to sell off blue chips following steep overnight losses on Wall Street, sending the key index below 2,000 points.
The benchmark Korea Composite Stock Price Index (KOSPI) plunged
63.63 points, or 3.11 percent, to 1,979.56.
Analysts said steel falls in U.S. stocks weakened investor sentiment in stocks across Asia.
The Dow Jones Industrial Average dropped more than 360 points at 13,300.02 Wednesday on concerns over weakening dollar and skyrocketing oil prices. The S&P 500 closed down 44.65, or 2.94 percent, at 1,475.62.
``Weak U.S. stocks unnerved investors in Asian bourses,'' said Kang Moon-sung, an analyst at Korea Investment & Securities.
The dollar weakened amid speculations that China will sell off dollars to diversify its foreign exchange reserves with Euro and other major currencies.
He said such a speculation has been lingering for some time, and that it will not pose risks to the country's equity market.
The local currency lost 2.2 won to close at 908.30 against the dollar.
As expected, the stock market was little affected by the decision by the Bank of Korea to leave its key interest rate
unchanged at 5 percent in November, Kang added.
Most shares were severely dented, with steel and finance shares leading the decline. Top steelmakers POSCO and Hyundai Steel plunged 5.37 percent to 582,000 won and No. 1 lender Kookmin Bank lost 2.34 percent to finish at 66,900 won.
Market heavyweight Samsung Electronics declined 5.96 percent to 536,000 won, dragging along tech exporters. Shipbuilding and automaking shares were also down. World's No. 1 shipyard Hyundai Heavy Industries slid 3.6 percent to 509,000 won.
Builders, however, gained ground as industry leader Daewoo Engineering Construction surged 6.56 percent to 26,000 won on a buying spree ahead of the company's near-month trade suspension starting Friday for its planned capital reduction.