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Seoul shares seen deepening losses as Fed plans hit global equities
June 20, 2013 / 11:49 PM / 4 years ago

Seoul shares seen deepening losses as Fed plans hit global equities

SEOUL, June 21 (Reuters) - Seoul shares are likely to open
lower on Friday after Wall Street slumped to its biggest loss in
18 months as the Federal Reserve's plan to start winding down
its stimulus later this year took a heavy toll on global risk
    "The market is set to start off in negative territory.
Foreign investors will continue selling today," said Jun Ji-won,
a market analyst at Kiwoom Securities.
    The Korea Composite Stock Price Index (KOSPI) ended
down 2 percent at 1,850.49 points on Thursday, the lowest close
in nearly 11 months.
    Foreign investors were sellers for a 10th straight session,
the longest selling streak in three months.
    "Falls however will not likely be as sharp as yesterday,
probably in a 1 percent range, as the market has relatively firm
support at its current level," Jun added.
    Global equity markets, bond prices and commodities tumbled
on Thursday as investors worried that the Fed's plan to
eventually stop pumping cheap money into the U.S. economy next
year could undermine a sluggish global recovery. 
    Fed Chairman Ben Bernanke said on Wednesday that the central
bank could start to trim its massive stimulus sometime this year
if the economy improved as expected.   
    KOSPI's 90-day relative strength index (RSI) read 40.6,
approaching near the oversold territory mark of 30. South
Korea's 12-month forward price earnings multiple stood at 8.9
compared with its peer Taiwan's 13.8, Thomson Reuters StarMine
data showed.
    Technology stocks like SK Hynix will likely be
hit by the heightened risk-aversion and a further 3.1 percent
fall in the U.S. semiconductor index overnight.
    But shipping issues such as Hanjin Shipping may
outperform after the Baltic dry index, which measures
the cost of shipping key commodities, posted a 1.7 percent gain
--------------MARKET SNAPSHOT @ 22:43 GMT-----------------------
                  INSTRUMENT          LAST    PCT CHG    NET CHG
S&P 500                    1,588.19      -2.5%    -40.740
USD/JPY                       97.27        -0%      0.000
10-YR US TSY YLD         2.421       --        0.000
SPOT GOLD                 $1,278.01      0.02%      0.270
US CRUDE                     $94.90     -0.25%     -0.240
DOW JONES                  14758.32     -2.34%    -353.87
ASIA ADRS                   129.52     -3.61%      -4.85
>Wall St plunge,S&P post biggest drop since Nov 2011 
>U.S. bond market slides as Fed plans become clearer 
>US dollar gains broadly on Fed outlook, US data    
>Oil hit by biggest decline since Nov on Fed plan   

    The bulk shipper shares may react after it filed for
protection under U.S. bankruptcy law on Thursday to shield its
assets from creditors in the United States, less than two weeks
after filing for court receivership in South
    Germany's SGL Group said it is setting up a joint
venture with Samsung Electronics for the use of SGL's carbon
fibre composite parts in consumer electronics, medical devices
and technical equipments. 

 (Reporting by Jungyoun Park; Editing by Shri Navaratnam)

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