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S.Korea shares skid to 3-week low on MSCI's nod to China, oil slumps
June 21, 2017 / 2:46 AM / 6 months ago

S.Korea shares skid to 3-week low on MSCI's nod to China, oil slumps

    * KOSPI falls on selling by foreigners, institutional
    * KOSPI expected to recoup losses over next few days

    SEOUL, June 21 (Reuters) - South Korean shares slipped to a
3-week low early on Wednesday as foreign investors turned
somewhat bearish following MSCI's         's decision to add
China's mainland-listed shares to its global indexes and as oil
prices slumped.
    The Korea Composite Stock Price Index (KOSPI)         was
down 0.4 percent at 2,359.97 points as of 0213 GMT, after
touching 2,346.19, the lowest since June 1.
    "Declines in oil prices and China equities joining the
global index are discouraging foreign investors now," said Kim
Ye-eun, a stock analyst at Cape Investment & Securities.
    "Apart from the IT sector, all major blue chips seem to be
edging down. Shares will decline broadly but will recoup towards
the end of this week as China domestic equities joining the MSCI
index is a temporary issue," Kim said.     
    A senior government official said the South Korean share
market could see outflows of up to 4.3 trillion won ($3.78
billion) after the U.S. index provider said it will add domestic
Chinese equities to its widely tracked Emerging Markets Index
    While the inclusion could draw billions of dollars to
China's A shares and decrease South Korea's weight in the index,
most analysts expect the overall impact won't be significant on
Seoul equities as the benchmark KOSPI is a highly liquid market.
    Indeed, the government said Seoul shares are likely to shrug
off an outflow of few trillion won, as the total market
capitalization of stocks listed on the benchmark main KOSPI
        is at 1,536 trillion won as of the closing on June 20.
    Foreign investors net sold 100.5 billion won ($88.24
million) worth of KOSPI shares near mid-session, while
institutional investors offloaded 72.4 billion won, which
dragged down the index. 
    Market heavyweight Samsung Electronics             lost 1.9
percent while Hyundai Motor             was down 1.8 percent.
    The South Korean won        dropped to a two-month low. 
    The won            was quoted at 1,141.2 against the dollar,
down 0.5 percent versus Tuesday's close of 1,135.4. 

                       0213 GMT    Prev close
 Dollar/won             1,141.2      1,135.4
 Yen/won                10.2515      10.2362
 *KTB futures            109.43       109.44
 KOSPI                 2,359.97     2,369.23
 * Front-month futures on three-year treasury bonds

($1 = 1,138.9000 won)

 (Reporting by Cynthia Kim; Editing by Shri Navaratnam)

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