Seoul shares eased as South Korea held military drills on Monday, prompting profit-taking after these index hit a 37-month high in the previous session and sending key technology and auto issues lower. The Korea Composite Stock Price Index (KOSPI) finished down 0.3 percent at 2,020.28 points. The KOSPI 200 March futures index fell 0.35 points to 265.90.
The KOSPI 200 spot index slipped 0.25 points to 267.42. The junior Kosdaq market lost 2.5 percent to 497.95. The South Korean military started the planned artillery drill from an island near the border with North Korea, a military official said. South Korea's sovereign rating could be lowered by several notches if there are signs that a wider military conflict with North Korea is inevitable, but this is not the likely scenario, Standard & Poor's South Korea analyst said on Monday.
Foreign investors were buyers of a net 169.5 billion won ($146.8 million) worth of stocks, picking up shares for a sixth consecutive session. Woori Finance Holdings Co Ltd pared earlier losses of as much as 1.7 percent, jumping 6.6 percent amid views its shares were trading cheaply following recent steep losses.
"The current level is undoubtedly cheap," Ku said, adding that "uncertainties" around its privatisation remained and could continue to weigh on its share price. Brokerages advanced on hopes they may reap stronger earnings on the back of the stock market's recent rally. Samsung Securities Co Ltd rose 2.9 percent and Woori Investment & Securities Co Ltd climbed 3.7 percent.
Defence issues outperformed as tensions mounted. Military equipment producers Victek Co Ltd and Huneed Technologies Co Ltd rose 1.9 percent and 0.7 percent respectively. But blue chip technology and auto issues weighed. LG Electronics Inc, the world's No 2 handset maker, declined 0.9 percent and Hynix Semiconductor Inc , the world's No 2 memory chip maker, shed 0.6 percent. Trading volume was 402 million shares worth 7 trillion won, compared with average daily trading volume and turnover of 346.6 million shares worth 6.7 trillion won in November.
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