Shares drop 2.21% on weak US, Chinese economic data

Shares drop 2.21% on weak US, Chinese economic data

Korean stocks dived 2.21 percent Friday on weak U.S. and Chinese economic data and lingering eurozone uncertainties, analysts said. The local currency fell against the U.S. dollar. The benchmark Korea Composite Stock Price Index (KOSPI) plunged 41.76 points to close at 1,847.39. Trading volume was very light at 286 million shares worth 4.27 trillion won ($3.69 billion), with losers clearly outpacing gainers 577 to 254. "The sharp loss was mainly caused by indications that the U.S. and Chinese economies are not doing well at the moment, with such conditions exacerbated by Spain's banking sector woes and overall uncertainties in the eurozone," said Cho Byung-hyun, an analyst at Tongyang Securities. The U.S. reported weak manufacturing and employment data, while China's manufacturing sector purchasing managers' index for June slipped compared the month before. Kim Jae-hong, an economist at Shinyoung Securities, said the KOSPI is being pressured by disappointing economic indicators from all major economies. He added that despite positive election results in Greece, the 17-member eurozone needs to come up with a viable plan to handle problems facing Spain and other debt-ridden countries. Most big-cap shares in electronics, autos, steel, heavy industries and chemicals lost ground during the trading session. Market bellwether Samsung Electronics nosedived 3.67 percent to 1,182,000 won, with leading carmaker Hyundai Motor losing 2.99 percent to 243,000 won. No. 2 carmaker Kia Motors shed 1.65 percent to 77,500 won, with top steelmaker POSCO falling 2.24 percent to 370,500 won. LG Chem, a leading manufacturer of rechargeable batteries, lost 3.47 percent to 278,500 won, with Hyundai Heavy Industries, the world's largest shipmaker, slipping 4.02 percent to 262,500 won. Top auto parts maker Hyundai Mobis lost 2.79 percent to 278,500 won, with leading life insurer Samsung Life Insurance backtracking 1.46 percent to 94,800 won. The local currency finished at 1,156.8 won to the U.S. greenback, down 5.2 won from Thursday's close. Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasuries fell 0.02 percentage point to 3.29 percent, while the return on the benchmark five-year government bonds also slipped 0.02 percentage point to 3.42 percent. (Yonhap)