S.Korean stocks post sharpest fall in 15 months as China virus spreads

Able C&C Co

28/01/2020 07:42

* KOSPI drops over 3%, foreigners net sellers
    * Korean won posts lowest close since Dec. 12, 2019
    * South Korea benchmark bond yield falls
    * For the midday report, please click  urn:newsml:reuters.com:*:nL4N29X04G

    By Hayoung Choi
    SEOUL, Jan 28 (Reuters) - South Korean shares suffered their
worst session in more than 15 months on Tuesday, dragged down by
mounting worries over the economic impact of the new coronavirus
outbreak. 
   Local stocks exposed to China, the biggest buyer of South
Korean goods, dominated the losses as the death toll from the
virus in the world's second-largest economy climbed to 106 and
some health experts questioned whether Beijing can contain the
virus, which could threaten global growth.   urn:newsml:reuters.com:*:nL4N29V0FY   
    The Seoul stock market's KOSPI index  .KS11  ended down
69.41 points, or 3.09%, at 2,176.72, posting its sharpest
one-day fall since Oct. 11, 2018. The index touched its lowest
since Jan. 8 earlier in the session. 
    "South Korea's economy could take a bigger hit compared with
other Asian countries due to its significant trade volume with
China," said Choi Seok-won, chief of SK Securities' research
centre.
    He added that the market is likely to bottom out only after
investors confirm that China's countermeasures are working
effectively.
    South Korean cosmetic makers highly dependent on Chinese
tourists visiting Seoul tumbled, with Tonymoly  214420.KS  and
Able C&C  078520.KS  losing more than 12% and 15%, respectively.
China has discouraged its citizens from travelling abroad amid
the virus outbreak.  urn:newsml:reuters.com:*:nB9N29J01N
    On the other hand, mask producers, Kleannara  004540.KS  and
Monalisa  012690.KS  were the best performers in the broader
market, as they firmed 30% each to hit intraday price limit. 
    The Korean won slipped 0.68% versus the dollar, in line with
Asian peers. The won was quoted at 1,176.7 per dollar on the
onshore settlement platform  KRW=KFTC , registering its lowest
close since Dec. 12, 2019. 
    On the main board, foreign investors offloaded 523.2 billion
won ($448.25 million) worth of local stocks, marking their
biggest net sales since Nov. 26, 2019. 
    The trading volume during the session in the KOSPI index
 .KS11  was 800.05 million shares and, of the total traded
issues of 909, the number of advancing shares was 82. 
    The downturn in sentiment sent investors to safe havens,
sending bond yields down. The most liquid 3-year Korean treasury
bond yield fell by 6.9 basis points to 1.353%, while the
benchmark 10-year yield fell by 10.2 basis points to 1.603%.
    
    ($1 = 1,167.2000 won)    

 (Editing by Aditya Soni)
 ((hayoung.choi@thomsonreuters.com; +82 2 6936 1468;))