(LEAD) Seoul shares end 0.66 pct down on recovery concerns

(ATTN: ADDS bond yields at bottom)
By Lee Youkyung
SEOUL, Feb. 2 (Yonhap) -- South Korean stocks closed 0.66 percent lower Tuesday
as a surprise rate freeze by the Australian central bank renewed concerns about
the strength of a global economic recovery, analysts said.

Reversing earlier gains, the benchmark Korea Composite Stock Price Index (KOSPI)
lost 10.63 points to end at 1,595.81. Volume was moderate at 430 million shares
worth 4.94 trillion won (US$4.26 billion) with losers leading gainers 409 to 355.

"The market has widely expected that Austria would lift the benchmark rate this
month," said Lim Dong-rak, an analyst at Hanyang Securities. "Responses to the
rate freeze in foreign exchange markets were prompt. The Australian dollar and
other emerging market currencies went down against the U.S. dollar."
The Reserve Bank of Australia has raised the monthly key interest rate by 25
basis points since October. But it kept the rate on hold on Tuesday, citing the
need to reassess the effects of its tightening policy begun in 2009.
Automakers lost ground as investors sought to take profits after sweeping recalls
by Toyota Motor Corp. lifted South Korean auto shares. Top auto maker Hyundai
Motor Co. slumped 3.45 percent to 112,000 won while its smaller affiliate Kia
Motors Corp. lost 2.18 percent to 20,200 won.
Retailers were among the weakest performers. Lotte Shopping dropped 1.93 percent
to 305,500 won and its rival Shinsegae sank 4.21 percent to 501,000 won on
concerns about a growth slowdown this year.
Tech shares closed mixed. Market heavyweight Samsung Electronics closed down 0.64
percent to 772,000 won while LG Display, the world's second-largest maker of flat
screen panels, rose 0.41 percent to 37,159 won.
The local currency closed at 1,159.90 won against the U.S. dollar, up 9.60 won
from Monday's close on reports that the country's foreign exchange reserves
reached a fresh record high of US$273.69 billion in January, dealers said.
Bond prices, which move inversely to yields, closed higher. The yield on the
benchmark three-year Treasury note fell 0.03 percentage point to 4.27 percent,
and the return on five-year government bonds dropped 0.01 percentage point to
close at 4.84 percent.
ylee@yna.co.kr
(END)