Seoul stocks close 2.06 pct lower on security woes

SEOUL, May 26 (Yonhap) -- South Korean stocks finished 2.06 percent lower Tuesday
as concerns over rising inter-Korean tension dashed investor confidence, analysts
said. The local currency lost ground against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) skidded 28.86 points to
1,372.04, extending its losing run to a fourth session. Volume was moderate at
648.1 million shares worth 7.85 trillion won (US$6.2 billion), with losers
outpacing gainers 646 to 185.
"After shrugging off the North's nuke test on Monday, investors were worried
inter-Korean relations would worsen further after South Korea's decision to join
the Proliferation Security Initiative," said Lee Jae-hoon, an analyst at Mirae
Asset Securities.
Earlier in the day, South Korea declared its participation in the U.S.-led
campaign to stop the spread of weapons of mass destruction, a day after the North
conducted a nuclear test.
Large-cap electronics lost ground, weighed down by heavy institutional selling.
Market leader Samsung Electronics finished 1.28 percent lower to 538,000 won and
its smaller rival LG Electronics lost 2.28 percent to 107,000 won.
Financial shares also ended sharply lower on renewed jitters over the global
financial crisis following credit appraiser S&P's downward revision of Britain's
economic outlook.
Top financial firm KB Financial Group tumbled 4.22 percent to 43,100 won with
Woori Finance Holding falling 3.98 percent to end at 10,850 won.
However, companies recently added to the KOSPI 200 index, which tracks the 200
biggest firms in the market, gathered ground as their selection is expected to
boost demand for their shares. Hanjin Heavy Industries & Construction, the
fifth-largest shipbuilder, jumped 2.57 percent to 35,900 won and top bulk-carrier
STX Pan Ocean surged 3.04 percent to end at 11,850 won.
The local currency ended at 1,263 won against the dollar, down 14 won from
Monday's close, as tensions with the North escalated risk fears over the
peninsula, dealers said.
pbr@yna.co.kr
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