Seoul stocks edge down on persistent foreign selling, won eases

Sun May 11, 2014 10:37pm EDT

* Foreign investors headed for 8th straight day of net
selling
    * Won slides after finance ministry warning on Friday

    SEOUL, May 9 (Reuters) - Seoul shares slipped on Monday as
foreign investors extended their selling streak, although
bargain hunting by institutional investors helped limit losses,
while the won eased on concerns of possible intervention by the
local currency authorities.
    The Korea Composite Stock Price Index (KOSPI) was
down 0.2 percent at 1,952.02 points as of 0210 GMT.
    "The continued foreign capital outflows are triggering
losses, but institutional investors are picking up local shares
on dips around the 1,950 point level, preventing a sharp fall,"
said Mirae Asset Securities analyst Chung Seung-jae.
    Offshore investors sold a net 46.1 billion won ($45 million)
worth of KOSPI shares by late morning, headed for an eighth
straight day of selling. Domestic institutional investors
purchased a net 21 billion won worth.
    "The market lacks internal catalysts for a rise, given the
won's rapid appreciation is weighing on exporters' earnings
outlook for the coming quarters, so investors will focus more on
economic conditions in the U.S. and China, which are expected to
improve gradually," Chung added.
    Samsung Electronics Co Ltd, which accounts for
17 percent of the KOSPI, advanced 1.4 percent. Investors were
buying back the stock following a 4.6 percent drop over a
two-week period, shrugging off concerns about the health of its
chairman.
    Lee Kun-hee, 72, was admitted to a hospital near his home
late on Saturday night, suffering breathing difficulties, and
received cardiopulmonary resuscitation (CPR) for symptoms of
cardiac arrest. The Samsung Medical Center, where
Lee is hospitalised, on Monday said he is in stable condition.
    Lotte Shopping Co Ltd dropped 4.6 percent after
its first-quarter operating profit fell 7.8 percent from a year
earlier, with its stores in China struggling to post profits due
to intensified competition and slowing growth in the world's
second-largest economy.
    In the currency market, the won slipped as the dollar
strengthened against a basket of currencies, while investors
were wary of possible intervention by South Korean foreign
exchange authorities following a warning on Friday.
    The finance ministry said it will take decisive measures
against speculative moves that cause one-sided movements in the
won, which has rapidly risen to near six-year highs against the
dollar. 
    "The local authority has shown its strong stance to the
currency market, limiting the won's upward momentum amid an
absence in downside risks," said a currency dealer, who expects
the won to trade in a range of 1,018 to 1,028 versus the
greenback this week.
    The local currency was quoted at 1,025.7 against
the dollar as of 0210 GMT, down 0.1 percent from Friday's
onshore close at 1,024.4.
    
                       0210 GMT    Prev close
 Dollar/won            1,025.7       1,024.4
 Yen/won           10.0549/598       10.0555
 *KTB futures           105.95        105.98
 KOSPI                1,952.02      1,956.55
 * Front-month futures on three-year treasury bonds
($1 = 1024.4500 Korean Won)

 (Reporting by Jungmin Jang; Additional reporting by KyoungHo
Lee and Yena Park; Editing by Chris Gallagher)