By Kim Jae-won
Seoul shares closed sharply lower Tuesday, hit by slumping oil prices and concerns that Greece may leave the eurozone.
The benchmark KOSPI closed down 33.3 points, or 1.74 percent, at 1,882.45.
The prolonged slide in oil prices has fueled concern it might presage a global slowdown, along with euro jitters that Greece may not stick to the terms of its bailout to remain in the euro bloc.
Greece’s anti-austerity Syriza Party is expected to win national elections this month and has fed doubts about the country’s future within the euro.
Analysts said the drop in crude oil prices reflects a growing supply and slowdown in global demand.
“Concerns about possible deflation from falling oil prices and jitters about the fallout of Greece and other markets has forced investors to dump stocks,” an analyst from a brokerage said.
The drop in crude oil prices to around $50 a barrel from about $95 a barrel in July 2014 reflects a number of factors, including growing supply from non-OPEC countries, particularly the U.S., a slowdown in global demand, and Saudi Arabia’s decision not to continue acting as OPEC’s swing producer, according to the Moody’s.
SK Innovation, the country’s leading oil company, also saw its shares drop 3.05 percent to 79,500 won. Leading shipbuilder Hyundai Heavy Industries slumped 4.65 percent to 102,500 won, and Samsung Heavy Industries dipped 4.46 percent to finish at 18,200 won.
Cheil Industries, the de facto holding company of the Samsung Group, dropped 4.81 percent to end at 138,500 won.
The company sank by the daily permissible limit of 15 percent Monday as investors locked in parts of gains from the past few sessions.
The local currency ended at 1,098.8 won against the U.S. dollar, up 11.1 won from Monday’s close, snapping a three-day loss as it followed gains in the Japanese yen, which rose against its peers.
Other major shares closed lower, with Samsung Electronics falling 2.85 percent to 1.295 million won and Hyundai Motor losing 2.08 percent to 164,500 won.