Share down 0.65% on US budget woes

Korean stocks closed 0.65 percent lower on Wednesday as continued concerns on the U.S. fiscal cliff issue weighed on investor sentiment, analysts said. The local currency fell against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) dropped 12.42 points to 1,912.78. Trading volume was moderate at 403.5 million shares worth 3.85 trillion won ($3.55 billion), with decliners outnumbering gainers 523 to 270.

"Lingering worries over a U.S. budget impasse offset positive factors such as the latest development to aid Greek debts and solid economic data from the U.S.," said Lim Dong-lak, an analyst at Hanyang Securities Co.

"It seems that investor sentiment will likely remain tepid due to political uncertainties over the fiscal cliff issue," Lim said.

Blue-chip exporters lost ground across the board. Top steelmaker POSCO fell 2.19 percent to 312,500 won and market bellwether Samsung Electronics slipped 0.21 percent to 1,413,000 won.

Bank shares also ended in negative territory, with KB Financial Group losing 2 percent to 34,350 won.

In contrast, confectionery maker Orion rose 2.58 percent to 1,113,000 won on hopes it will benefit from China's growing confectionery market.

Beermaker Hite Jinro jumped 4.85 percent to 30,250 won following a 65.3 percent on-year jump in its third-quarter operating profit.

Cheil Industries, the textile and chemical arm of Samsung, closed 2.28 percent higher at 94,400 won on views it will reap a record quarterly profit in the October-December period.

The local currency ended at 1,086.5 won against the greenback, down 2.4 won from Tuesday's close, as U.S. budget concerns dampened investor appetite for riskier assets, dealers said.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasuries slipped 0.01 percentage point to 2.83 percent and the return on the benchmark five-year government bonds fell 0.02 percentage point to 2.90 percent.(Yonhap)