BUSINESS S.Korean stocks tumble on worry about COVID-19 outbreak

BUSINESS

S.Korean stocks tumble on worry about COVID-19 outbreak

Xinhua

17:41, March 16, 2020

SEOUL, March 16 (Xinhua) – South Korean stocks ended 3.2 percent lower Monday on rising worry about the global economic slump from the COVID-19 spreading across the globe.

VCG111275546437.jpg

(Photo: VCG)

The benchmark Korea Composite Stock Price Index (KOSPI) dived 56.58 points, or 3.19 percent, to settle at 1,714.86. Trading volume stood at 671 million shares worth 8.5 trillion won (6.9 billion U.S. dollars).

It was the lowest close in about eight and a half years since October 2011.

The U.S. Federal Reserve slashed its key rate by a full percentage point to near zero and vowed to buy 700 billion U.S. dollars of U.S. government and mortgage bonds for a liquidity supply, but the emergency moves failed to ease market volatility.

Foreign investors dumped local stocks, remaining as net sellers for the eighth consecutive session.

The small-cap KOSDAQ plummeted 19.49 points, or 3.72 percent, to close at 504.01.

Foreigners sold the local currency and bought domestic bonds as risk-off sentiment deepened over the coronavirus spread around the world.

The won/dollar exchange rate gained 6.7 won to finish at 1,226.0 won per dollar, marking the highest close in some four years since March 2016.

With the Fed’s rate cut, expectations grew for South Korea’s central bank to slash its target rate further, driving the treasury yields lower.

Yields on the liquid three-year treasury notes dipped 5.0 basis points to 1.099 percent, and the return on the 10-year government bonds retreated 4.6 basis points to 1.524 percent.

After the market close, the Bank of Korea (BOK) lowered its policy rate by 50 basis points to an all-time low of 0.75 percent in its first emergency action since the 2008 global financial crisis.

Large-cap shares lost ground. Market bellwether Samsung Electronics declined 2.1 percent, and memory chip giant SK Hynix retreated 2.3 percent. The most-used search engine Naver plunged 6.6 percent, and leading chemical firm LG Chem plummeted 8.2 percent.

The biggest automaker Hyundai Motor slipped 4.9 percent, and Samsung BioLogics, a biopharmaceutical unit of Samsung Group, dropped 5.8 percent. 

Related Stories

Terms of Service & Privacy Policy

We have updated our privacy policy to comply with the latest laws and regulations. The updated policy explains the mechanism of how we collect and treat your personal data. You can learn more about the rights you have by reading our terms of service. Please read them carefully. By clicking AGREE, you indicate that you have read and agreed to our privacy policies

Agree and continue