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S.Korean shares sink to 5-week low on yen fears, foreign selling persists
March 22, 2013 / 6:31 AM / 5 years ago

S.Korean shares sink to 5-week low on yen fears, foreign selling persists

* Foreigners sell for 7th day on weak yen

* LG Elec up on better earnings outlook

* KEPCO rises on Vietnam power deal

* Telecoms extend losses

By Somang Yang

SEOUL, March 22 (Reuters) - South Korean shares eased on Friday amid a seventh day of foreign selling over concerns that the yen will weaken further under the new chief of the Bank of Japan.

The Korea Composite Stock Price Index (KOSPI) closed down 0.11 percent at 1,948.71 points, a new 5-week low. The index shed 1.9 percent on the week and is down 2.4 percent for the year to date.

“There isn’t much scope for the KOSPI to rise, particularly as the yen is seen further weakening under a new BOJ leadership,” said Park Hyung-joong, an economist at Meritz Securities.

The new Bank of Japan chief reaffirmed his commitment to monetary easing in his inaugural address, a policy move that has the side-effect of weakening the yen.

Park added that weakness of the yen, which helps Japanese exporters at the expense of South Korean rivals, was partly responsible for the extended foreign sell-off.

The foreign selling on Friday brought the week’s total to 2.35 trillion Korean won ($2.11 billion).

Telecoms led the losses, falling 2.4 percent as investors questioned the future of the stagnant industry.

However, LG Electronics bucked the market, climbing 1.5 percent. The outlook for the firm over the Jan-March period is being raised as its smartphones grab market share, according to Chun Young-hwan, an analyst at IM Securities.

Overall, 429 shares advanced while 370 declined.

The KOSPI 200 benchmark of core stocks closed down 0.2 percent, while the junior KOSDAQ edged 1.2 percent higher.

Move on day -0.11 percent

12-month high 2,057.28 14 March 2012

12-month low 1,769.31 25 July 2012

Change on yr -2.42 percent

All-time high 2,231.47 27 April 2011

All-time low 93.10 6 January 1981 ($1 = 1115.7500 Korean won) (Editing by Kim Coghill)

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