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3 years ago
S.Korea stocks set for worst day in 2 weeks; won flat
July 9, 2014 / 2:41 AM / 3 years ago

S.Korea stocks set for worst day in 2 weeks; won flat

4 Min Read

* KOSPI down as foreigners sell stocks
    * Won little changed amid intervention caution

    SEOUL, July 9 (Reuters) - South Korean shares are set for
their worst day in two weeks on Wednesday as investors cut their
risk exposure after weaker-than-expected earnings guidance from
Samsung Electronics.
    The Korea Composite Stock Price Index (KOSPI) was
down 0.6 percent at 1,995.44 points as of 0234 GMT, headed for
its biggest percentage loss since June 25.
    "Samsung Electronics' guidance figures dented the
credibility on earnings estimates, and given the influence of
the tech giant in the market, what we're seeing is investors
lowering expectations for the market as a whole," said Song
Dong-heon, an analyst at Dongbu Securities.
    Foreign investors who purchased a net 1.5 trillion won
($1.48 billion) worth of local stocks in the past nine
consecutive sessions through Tuesday, offloaded a net 98 billion
won, bourse data showed.
    On Tuesday, Samsung Electronics Co Ltd said
operating profit for the April-June period was likely to come in
at 7.2 trillion won, well below the mean forecast of 8.3
trillion won from a Thomson Reuters I/B/E/S
survey. 
    The world's biggest mobile handset maker, which accounts for
16 percent of the KOSPI, edged up 0.2 percent on short-covering.
    LIG Investment & Securities analyst Oh Tae-dong said
investors would focus on a raft of Chinese data such as exports
for any upward momentum while keeping an eye on corporate
earnings.
    From Thursday to next week, Chinese exports, gross domestic
product and industrial output are due to be released.
    Steelmakers and shipbuilders slipped into negative territory
on a cloudy earnings outlook, with Hyundai Steel Co 
and Hyundai Heavy Industries Co Ltd  dropping 5.7
percent and 2 percent, respectively.
    In the local currency market, the won was quoted
at 1,012.2 versus the dollar as of 0234 GMT, compared with
Tuesday's onshore close.
    On Tuesday, the won ended weaker as some traders suspected
South Korean authorities of purchasing dollars to stem the
currency's further strength near market close, coinciding with
South Korea's nominee finance minister's remarks.
    Speaking at a parliamentary verification hearing session,
Choi Kyung-hwan commented that fast movement in foreign exchange
rates were undesirable regardless of the
direction. 
    With the won retreating from six-year highs, some market
participants expect further weakness in the currency should the
minutes of the June U.S. Federal Open Market Committee meeting
due later support strength in the greenback.
    In a note to clients, Woori Futures currency analyst Son
Eun-jeong wrote, "be mindful that the latest minutes can be more
hawkish than Federal Reserve Chair Janet Yellen's position as
there may be disagreements among committee members about
inflation and interest rates hike."
                       0234 GMT    Prev close
 Dollar/won            1,012.2       1,011.9
 Yen/won            9.9675/606        9.9547
 *KTB futures           106.58        106.55
 KOSPI                1,995.44      2,006.66
 * Front-month futures on three-year treasury bonds
($1 = 1012.3000 South Korean won)

 (Reporting by Jungmin Jang; Editing by Jacqueline Wong)

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