Seoul shares fall, nervy over N.Korea, cautious over Bernanke
* KOSPI briefly spooked by sudden N.Korea announcement * Major banks fall after probe on suspected collusion * SK Hynix tumbles after chipmaker peer Intel cuts outlook * Woongjin Energy slumps on terminated supply contract July 18 (Reuters) - Seoul shares fell on Wednesday on caution ahead of U.S. Federal Reserve Chairman Ben Bernanke's second day of congressional testimony, as investors had already suffered an attack of nerves brought on by North Korea saying it had an "important announcement". The Korea Composite Stock Price Index (KOSPI) fell 1.48 percent to close at 1,794.91 points, just below the key psychological level of 1,800 points. South Korean financial markets were briefly rocked, the main index fell more than one percent, after North Korea's state media said it would issue an "important report" at 0300 GMT. Shares later recovered to earlier levels after state media reported that North Korean leader Kim Jong-un would be marshal of the country's army. The respite was shortlived, and shares fell in afternoon trade as caution set in ahead of Bernanke's final day of testimony. "Investors may be on the backfoot ahead of Bernanke's speech and the unexpected noise from North Korea didn't help either, but today's sharp decline seems to have been exaggerated by thin trade," said Park Seung-jin, an analyst at Samsung Securities. Cyclicals underperformed, with shipyards hardest hit after investors were provided with few clues as to whether the Fed was moving was closer to another round of easing to bolster the flagging U.S. economy. Samsung Heavy Industries and Daewoo Shipbuilding & Marine Engineering both slumped 4.9 percent. Financials weighed, with declines steepening after South Korea's anti-trust agency launched a probe into the nation's top four commercial banks as part of a widening investigation into suspected collusion in setting certificate of deposit rates. All four banks fell more than 2 percent, with Hana Financial Group logging the heaviest decline of 2.7 percent while Woori Finance Holdings fell 2.6 percent. SK Hynix, the world's No.2 computer memory chip maker, sank 4.9 percent after top chipmaker Intel Corp reduced its growth forecast, reinforcing fears that a wavering global economy is dampening personal computer sales. Shares in Woongjin Energy tumbled 5.1 percent after saying its 58.5 billion won, long-term contract to supply polysilicon wafters to ARISE Technologies Deutschland GmbH had been terminated. Investors are keeping a busy eye on a slew of U.S. earnings this week, with Coca-Cola and Goldman Sachs joining the growing roster of S&P companies to beat profit forecasts, although expectations had been significantly lowered. South Korea's earnings season will be in full swing on Friday, beginning with POSCO, the world's third-largest steelmaker. Move on day -1.48 percent 12-month high 2,192.83 8 July 2011 12-month low 1,644.11 26 Sept 2011 Change on yr -1.68 percent All-time high 2,231.47 27 April 2011 All-time low 93.10 6 January 1981 (Reporting by Joonhee Yu; Editing by Simon Cameron-Moore)
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DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.