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Roundup: S.Korean shares drop on DPRK news

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Roundup: S.Korean shares drop on DPRK news

SEOUL, Dec. 4 (Xinhua) -- South Korean shares ended sharply lower Wednesday, keeping a downward trend for the fourth straight session, as foreign investors sold local stocks following the news that power rearrangement may be occurring in the Democratic People' s Republic of Korea (DPRK).

The benchmark Korea Composite Stock Price Index (KOSPI) dropped 22.56 points, or 1.12 percent, to close at 1,986.80. Trading volume stood at 223.65 million shares worth 3.39 trillion won (3.2 billion U.S. dollars).

South Korean Defense Minister Kim Kwan-jin said that work was under way within the DPRK to rearrange power structure, confirming the spy agency's claim that Jang Song-taek, uncle of DPRK leader Kim Jung-un and vice chairman of the DPRK's national defense commission, may have been purged.

Citing the National Intelligence Service (NIS) reports, lawmaker Jung Chung-rae said Tuesday that two close aides to Jang were executed in late November, noting that it had a high likelihood for Jang to have been purged as he has not been seen after the execution.

Unification Ministry spokeswoman Park Soo-jin said at the Wednesday press briefing that it was highly likely for Jang to have lost all his posts.

Foreigners sold local stocks worth more than 400 billion won following the DPRK news. Retail and institutional investors bought stocks worth 308.5 billion won and 86.9 billion won each, limiting the KOSPI's further decline.

Among large-cap shares, decliners outnumbered gainers. The world's largest shipbuilder Hyundai Heavy Industries tumbled 3.4 percent, and top automaker Hyundai Motor slid 2.5 percent. Market bellwether Samsung Electronics declined 2 percent, and leading chemical firm LG Chem retreated 1.1 percent.

The nation's biggest steelmaker POSCO edged down 0.3 percent, but the country's second-largest automaker Kia Motors inched up 0. 2 percent. Memory chip giant SK Hynix rose 0.3 percent.

The South Korean currency finished at 1,060.5 won against the greenback, up 0.7 won from Tuesday's close.

Bond prices ended mixed. The yield on the liquid three-year treasury notes fell 0.02 percentage point to 3.02 percent, but the return on the benchmark 10-year government bonds closed unchanged at 3.72 percent.

http://www.globalpost.com/dispatch/news/xinhua-news-agency/131204/roundup-skorean-shares-drop-dprk-news