Sun, Mar 09, 2003 - Page 11 News List

South Korean stocks drop this week, led by Hyundai

BLOOMBERG , SEOUL

South Korean stocks fell for a second week, led by Posco and Hyundai Motor Co, as a potential US-led war against Iraq and reports of a North Korean plan to test missiles damped some investors' demand for shares.

"The Korean market is trapped by both Iraq and North Korean problems," said Kim Hyun-tae, who manages US$165 million at Woori Investment Trust Management Co. "Investors are moving closer to a `sell Korea' view."

Kim said he has sold exporters such as Samsung Electronics Co and Hyundai Motor.

The KOSPI index slid 5.1 percent for the week, it biggest weekly decline since the five days ended Dec. 27. Some of South Korea's largest publicly traded companies slid after North Korean fighters shadowed a US Air Force reconnaissance plane off its coast. It was the first such incident in more than 30 years.

Benchmarks in Japan, Taiwan and Hong Kong also fell this week. Honda Motor Co and Sony Corp helped push the Nikkei 225 Stock Average and the Topix Index to their lowest in almost two decades on concern a US-led war against Iraq without UN support may curb consumer and business spending.

The Nikkei fell 2.6 percent for the week, while the Topix shed 2.8 percent.

The TAIEX Index lost 1.9 percent this week. Chipmakers led the TAIEX lower after the government said it may cut water supplies because of drought.

Hong Kong's Hang Seng Index fell for a second week, led by China Mobile (HK) Ltd, the world's No.1 mobile-phone company by subscribers. The index lost 2.4 percent this week.

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