(Updates to mid-morning)
By Park Jung-youn
SEOUL, June 18 (Reuters) - Seoul shares traded slightly
higher on Wednesday on gains by shipbuilders and shipping firms
after recent steep falls, but losses by blue chips such as Hynix
Semiconductor (000660.KS) continued to weigh on the index.
Shipbuilders rallied across the board after sharp losses this
month, with Hyundai Heavy Industries (009540.KS) rising 1.49
percent to 340,000 won after losing 11 percent on the month as of
Tuesday's closing.
The Korea Composite Stock Price Index was up 0.42
percent to 1,758.15 points, holding firm despite the U.S.
market's fall overnight, but analysts said sentiment and market
factors remained fragile.
"Today's gain is literally a technical rebound after steep
losses. The index will probably hover at around 1,750 and is
likely to face resistence substantially above that level," said
Y.S. Rhoo, a market analyst at Hyundai Securities.
The shipbuilding sector has been under pressure lately on
talk of steel price hikes and a downturn in China stock markets,
which are viewed as a gauge of future demand.
"Shipbuilders underwent massive falls that were way overdone,
even considering the unfavourable market factors. Shares are
trying to get back to a more or less normal level today," said
Sung Ki-jong, an analyst at Daewoo Securities.
Daewoo Shipbuilding & Marine Engineering (042660.KS) rose
2.75 percent to 41,150 won, and STX Shipbuilding (067250.KS) rose
2.79 percent to 31,350 won after steep fall earlier this week on
news of an affiliate's new rights issuance.
Shares in Hynix traded lower for a second day after the
world's No.2 memory chip maker said on Tuesday it would buy about
9.5 percent of rival Taiwan firm ProMos Technologies (5387.TWO)
for $168 million, paying a 13 percent premium.
Hynix fell 2.94 percent to 28,050 won.
Energy-sensitive transportation issues such as Korean Air
Line (003490.KS) and Asiana Airlines (020560.KS) rose after oil
prices eased on Tuesday.
Korean Air rose 1.74 percent to 52,500 won and Asiana
Airlines went up 1.22 percent to 5,830 won.
But financials such as Hana Financial Group (086790.KS) and
Woori Finance Holdings (053000.KS) underperformed the broader
market after Goldman Sachs warned that U.S. banks would have to
raise as much as $65 billion in capital to shore up balance
sheets weakened by the mortgage meltdown, saying the credit
crisis may not peak until 2009.
Hana Financial was flat at 44,150 won and Woori Finance was
down 0.27 percent at 18,300 won.
Carmakers such as Hyundai Motor (005380.KS) and Kia Motors
(000270.KS) also fell a day after Hyundai's union confirmed plans
to join an umbrella labour group's one-day strike in July.
Hyundai shed 0.86 percent to 80,500 won and Kia Motors fell
0.82 percent to 12,100 won.
