Seoul shares slump 1.06 pct on economic woes

SEOUL, July 11 (Yonhap) -- South Korean stocks closed 1.06 percent lower on Monday as investors cut their holdings amid concerns on overseas uncertainties such as the U.S. economic slowdown and China's inflation risk, analysts said. The local currency fell against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) tumbled 23.19 points to 2,157.16. Trading volume was moderate at 237.8 million shares worth 5.5 trillion won (US$5.2 billion), with losers outnumbering gainers 479 to 337.
"Investor sentiment was hurt by a combination of poor U.S. job data and weak forecasts for second-quarter corporate earnings as well as mounting inflation in China," said Lee Jae-man, an analyst at Tong Yang Securities Inc.
"But a correction may benefit the KOSPI following its recent seven-session winning streak. It needs to reduce some weight," said Lee.
Blue-chip exporters broadly lost ground on worries a slowing U.S. economy could lead to a decline in shipments of cars and electronic products.
Samsung Electronics, the world's No. 1 maker of memory chips and liquid crystal display (LCD) panels, slumped 2.26 percent to 865,000 won.
Top automaker Hyundai Motor sank 3.43 percent to 239,000 won, and its smaller affiliate Kia Motors fell 2.73 percent to 74,800 won.
Financial companies closed mixed. KB Financial Group added 0.93 percent to 54,500 won after its subsidiary Kookmin Bank sold out its remaining stake in the parent group last week, dissipating concerns over its share holdings. By banking law, the lender is required to unload its remaining 9.05 percent stake in KB Financial by the end of September.
However, No. 4 banking group Hana Financial Group dropped 2.19 percent to 37,950 after extending its agreement with Lone Star Funds to buy Korea Exchange Bank (KEB). The two sides agreed to lower the price tag on the No. 5 lender and extend their deal by six months to Nov. 30. KEB shed 0.53 percent to 9,350 won.
Hynix, whose creditors closed the preliminary bidding for a stake in the No. 2 memory chip maker on Friday, slipped 0.56 percent to 26,450 won. The two bidders -- SK Telecom and STX -- also lost ground on doubts the stake purchase can create synergy with their respective businesses. The top mobile carrier lost 3.68 percent to 144,000 won, and the shipping heavyweight fell 2.86 percent to 20,350 won.
The local currency closed at 1,057.8 won to the greenback, down 0.8 won from Friday's close, as investor appetite for risky assets waned due to poor U.S. economic data, dealers said.
mil@yna.co.kr