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Seoul shares end flat on Fed fears; defensives lag
May 30, 2013 / 7:18 AM / 4 years ago

Seoul shares end flat on Fed fears; defensives lag

* Foreign, pension fund buying helps support KOSPI

* Defensives lose steam, investors take profits

* Electricity supply worries boost some firms

SEOUL, May 30 (Reuters) - Seoul shares ended flat after moving in and out of the positive territory on Thursday, as fears the Federal Reserve could soon reduce its stimulus programme made investors fretful.

“Worries the U.S. Fed could curb its bond-purchasing sooner than most people expected kept investors a bit cautious today,” said Chung Seung-jae, a market analyst at Mirae Asset Securities.

Chung said he hopes there will be stronger foreign interest after Vanguard Group, the largest U.S. mutual fund manager, next month completes share sales it is doing while switching 22 of its biggest index funds away from benchmarks provided by MSCI Inc.

Foreign investors were net buyers of shares for a second day, purchasing 225.6 billion won of stocks. Domestic pension funds bought a net 57.6 billion won, picking up shares for a seventh straight session.

The Korea Composite Stock Price Index ended down 0.05 percent at 2,000.10 points.

Technology and auto exporters gained due to the strengthening of the Japanese yen, which eased concerns about how South Korean products can compete overseas with Japanese ones.

LG Display rose 1.6 percent and Hyundai Motor advanced 0.5 percent.

Defensive stocks in telecommunication and domestic consumption sector slid as investors locked in profits from a recent rally.

SK Telecom fell 1.9 percent and LG Uplus slumped 1.3 percent. Orion Corp, a snack maker, lost 2.4 percent and Amorepacific, a cosmetics giant, shed 2.1 percent.

Shares in Korea Electric Power Corp gained 1.1 percent after four days of falls, thanks to market talk the South Korean government may raise electricity tariffs in the summer.

Concerns about the country’s summer power supplies buoyed shares in companies related to energy storage and smart power grids. The concern stems from the shutdown of nuclear reactors.

Shares in Omni System, which makes high-tech power grids, spiked 15 percent. Samsung SDI, a maker of energy storage systems that hit a two-month high on Wednesday, rose 1.5 another percent.

Shares in Hyosung Corp, the holding company of Hyosung Group, and Hanwha Life Insurance fell as Hyosung Group and Hanwha are being investigated by South Korea’s National Tax Service.

Hyosung shares lost 4 percent and Hanwha Life 4.2 percent.

The KOSPI 200 benchmark of core stocks finished up 0.11 percent, while the junior KOSDAQ was 0.8 percent lower.

Move on day -0.05 percent

12-month high 2,042.48 3 January 2013

12-month low 1,758.99 25 July 2012

Change on yr 0.15 percent

All-time high 2,231.47 27 April 2011

All-time low 93.10 6 January 1981 (Reporting by Jungyoun Park; Editing by Richard Borsuk)

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