Seoul shares closed down Friday as institutional investors abandoned the market, but trimmed losses after briefly extending falls on unsubstantiated rumours of a possible downgrade to France's credit rating and a North Korean nuclear accident. "Rumours about a cut in France's ratings cut are just that, but reflect the very real problem of the deepening debt crisis in Europe," said Cho Sung-joon, a market analyst at NH Investment & Securities.
Shares briefly fell more than 2 percent and the won dipped 0.9 percent after talk of a downgrade and a critical incident at a North Korean nuclear facility, though officials said they were unaware of any such event. The Korea Composite Stock Price Index (KOSPI) fell 1.11 percent to close at 1,843.14 points, capping the week's gain at 0.95 percent.
Institutional investors snapped a five-day buying streak, offloading 72.6 billion won ($63.0 million) worth of shares while foreign investors dumped a net 45.3 billion won worth. Falls were led by construction shares, with Daewoo Engineering & Construction Co Ltd skidding 3.2 percent, while Samsung Engineering Co stumbled 3.91 percent.
Samsung Electronics Co fell 1.42 percent as investors cashed in despite the company announcing early on Friday lifetime high profit estimates for the fourth quarter backed by record-breaking handset sales. Pharmaceutical shares bucked the losing trend, with Green Cross soaring 4.9 percent on hopes of surging demand for its vaccine products following the latest bird flu outbreak in China. Ssangyong Motor powered up 14.98 percent after its CEO was quoted in local media as saying the automaker plans to enter the Indian market this year. The KOSPI 200 index fell 1.23 percent while the junior KOSDAQ index edged 0.58 percent lower.
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