Market bellwether Samsung Electronics Co. declined 2.92 percent to 1,596,000 won, top automaker Hyundai Motor was down 3.25 percent to 134,000 won and No. 2 chipmaker SK hynix Inc. fell 4.46 percent to 39,650 won. (image: KobizMedia/ Korea Bizwire)
SEOUL, Nov. 9 (Korea Bizwire) – South Korean shares plunged Wednesday as Republican presidential candidate Donald Trump won the White House. The local currency fell against the U.S. dollar.
The benchmark Korea Composite Stock Price Index shed 45.00 points, or 2.25 percent, to 1,958.38. The index fell to an intraday low of 1.931.07 during the session. The tech-heavy KOSDAQ index fell 3.92 percent to 599.74.
The decline came as Trump prevailed over his democratic rival Hillary Clinton in a crucial election that could set the tone for U.S. relations with other countries, including South Korea.
Some analysts have said a victory by Trump could heighten uncertainties in the stock markets, citing his calls for protectionism.
“Investors would avoid risky assets and favor safe assets due to policy uncertainty if Trump wins,” said Park Jong-yeon, an analyst at NH Investment & Securities.
Meanwhile, Gwak Hyun-su, an analyst at Shinhan Investment Corp., said Trump’s victory would not have any serious mid- to long-term impacts on the local stock markets, though it could cause a temporary decline.
He said it could take time if the U.S. wants to renegotiate a free trade deal with South Korea. Trump has denounced the 2012 pact as a “job-killing” deal and a “disaster.”
Gwak also said Trump’s victory could be positive for the U.S. economy, citing his pledge to boost investment in infrastructure.
Most large-cap stocks fell across the board.
Market bellwether Samsung Electronics Co. declined 2.92 percent to 1,596,000 won, top automaker Hyundai Motor was down 3.25 percent to 134,000 won and No. 2 chipmaker SK hynix Inc. fell 4.46 percent to 39,650 won.
Among gainers, leading cosmetics maker AmorePacific Corp. gained 1.12 percent to 362,000 won.
Victek and Speco rose by the daily permissible limit of 29.9 percent and 29.88 percent, respectively. Victek and Speco are two defense industry stocks.
Investors scooped up shares of Victek and Speco in anticipation of geopolitical risks driving up demand for defense industry stocks following Trump’s win.
The local currency closed at 1,149.50 won against the U.S. dollar, down 14.50 won from the previous session’s close.
Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys fell 2.3 basis points to 1.402 percent and the return on the benchmark five-year government bond dropped 2.1 basis points to 1.493 percent.
(Yonhap)
