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Seoul shares shed 0.3 pct on N.Korea, Europe worry
Reuters - 1 hour 9 minutes ago
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* KOSPI retreats as investors eye N.Korea, Europe
* Hyundai E&C tumbles after sale MOU is signed
SEOUL, Nov 29 - Seoul stocks ended slightly lower on Monday in cautious trade as investors kept an eye on tensions at home after North Korea's heavy artillery shelling of a South Korean island last week, while fears about Europe's financial health added pressure.
The Korea Composite Stock Price Index <.KS11> ended down 0.33 percent at 1,895.54 points.
"Investors are cautiously eyeing developments on the peninsula, but all-out war is highly unlikely and rangebound movement will probably ensue for sometime," said Bae Sung-young, a market analyst at Hyundai Securities.
A U.S. nuclear-powered aircraft carrier remained off the west coast of South Korea as forces from the two countries entered the second day of joint exercises aimed at deterring further provocations from Pyongyang.
South Korean President Lee Myung-bak on Monday labelled North Korea's artillery attack on a southern island a crime against humanity and said Pyongyang would pay the price for any further provocation. [ID:nTOE6AR029]
Analysts also said deepening concerns about Europe's credit health weighed, but a strong start to the U.S. Thanksgiving holiday shopping season was helping sentiment.
The European Union's bailout of Ireland is unlikely to halt expectations that the euro zone debt crisis will spread to Portugal, or provide reassurance that a firewall can be built around Spain. [ID:nLDE6AR09R]
"U.S. holiday shopping appears to have kicked off quite robustly, which is good," said Lawrence Kim, a market analyst at Woori Investment & Securities.
U.S. shoppers were in a Black Friday bargain-binge mood, snapping up hoodies and computer laptops at stores in a turnout that could give the economic recovery more steam. [ID:nNN2529414]
Technology issues outperformed. Hynix Semiconductor Inc <000660.KS>, the world's second-biggest chipmaker, climbed 0.6 percent, and LG Display Co Ltd <034220.KS>, the world's No.2 flat panel maker, rose 0.1 percent.
Korea Exchange Bank <004940.KS> lost 5.9 percent as investors took to the view that Hana Financial Group's eventual buyout strategy for the remaining stake in KEB would likely favor Hana more than minority shareholders, analysts said.
"KEB's generous dividend policy, which has benefited minority shareholders, could change. Also Hana's new strategy of buying out the remaining stake in KEB may favor Hana Financial more," said Ku Yong-uk, an analyst at Daewoo Securities.
Hana Financial last week agreed to buy 51 percent of Korea Exchange Bank for $4.1 billion in South Korea's biggest banking deal, trumping rival suitor Australia and New Zealand Banking Group <ANZ.AX>. [ID:nSGE6AO059]
Hyundai Engineering & Construction Co Ltd <000720.KS> tumbled 2.6 percent after news that shareholders had signed a memorandum of understanding to sell a controlling stake to preferred bidder Hyundai Group. [ID:nTOE6AS04G]
Analysts said there was concern over Hyundai Group's financial ability to handle the buyout as it may be forced sell some key assets of Hyundai E&C to finance the deal.
Trading volume was 294.2 million shares worth 4.5 trillion won, compared with average daily trading volume and turnover of 326.7 million shares worth 6.5 trillion won in October.
The KOSPI 200 Dec futures <KSc1> index fell 1.2 points to 249.10. The KOSPI 200 spot index <.KS200> shed 0.39 points to 248.92.
The junior Kosdaq market <.KQ11> rose 0.16 percent to 494.33.
Move on day -0.33 percent
12-month high 1,976.46 11 NOV 2010
12-month low 1,519.40 27 NOV 2009
Change on yr +12.64 percent
All-time high 2,085.45 1 NOV 2007
All-time low 93.10 6 JAN 1981 (jungyoun.park@thomsonreuters.com; +82 2 3704 5643; Reuters Messaging: jungyoun.park.reuters.com@reuters.net))
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