Seoul shares end 2.9 pct lower on profit-taking

(ATTN: ADDS bond yields at bottom)
SEOUL, April 8 (Yonhap) -- South Korean stocks tumbled 2.93 percent Wednesday on
heavy profit-taking following recent surges and overnight falls in U.S. markets,
analysts said. The local currency fell against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) lost 38.03 points to
close at 1,262.07. Volume was heavy at 742.6 million shares worth 6.59 trillion
won (US$4.86 billion), with losers outpacing gainers 507 to 316.
"The KOSPI's recent sharp rises prompted foreign and institutional investors to
book profits," said Kwak Joong-bo, an analyst at Hana Daetoo Securities Co. "But
I think the Seoul bourse still has upward momentum, given a stabilizing currency
and budding signs of an economic recovery."
The KOSPI, which started weaker following Wall Street losses, extended earlier
falls in late trading as institutional and foreign investors increased their
selling. Offshore investors sold a net 283 billion won worth of local stocks on
the main bourse. On Tuesday, the KOSPI breached the 1,300-point level for the
first time in about six months.
Analysts said investors also took a breather ahead of a rate decision by the Bank
of Korea (BOK). The BOK is widely expected to freeze the key rate for the second
straight month at a record low of 2 percent on Thursday.
Market leader Samsung Electronics plunged 4.62 percent to 557,000 won and chip
giant Hynix Semiconductor fell 2.1 percent to 14,000 won.
Financial shares were under selling pressure amid lingering concerns over the
U.S. financial sector. KB Financial Group, the holding company of Kookmin Bank,
fell 4.59 percent to 35,350 won and its rival Shinhan Financial Group declined
4.5 percent to 27,600 won.
But Ssangyong Motor, which entered court receivership in February under crushing
debt, jumped the daily limit of 15 percent to 1,740 won after it unveiled a
business turnaround plan that included laying off 37 percent of its total
workforce.
U.S. stocks closed lower Tuesday as investors were wary with the first-quarter
earnings season getting under way. The Dow Jones industrial average fell 2.34
percent and the tech-heavy Nasdaq composite index declined 2.81 percent.
The local currency ended at 1,354.5 won against the U.S. dollar, down 32 won from
Tuesday's close, as foreign investors cut their holdings of Seoul stocks, dealers
said.
Bond prices, which move inversely to yields, closed higher. The return on
three-year Treasuries shed 0.05 percentage point to 3.89 percent and the
benchmark yield on five-year government bonds declined 0.11 percentage point to
4.66 percent.
sooyeon@yna.co.kr
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