SEOUL, Apr 12: South Korean shares declined on Friday, with auto plays and shipbuilders leading losses on concerns about weak earnings that offset positive US labour data.
The Korea Composite Stock Price Index (KOSPI) ticked 0.3 percent lower at 1,943.92 points as of 0232 GMT, after opening up 0.23 percent.
‘No North Korean military action has materialised yet, so earnings are having a major impact on today’s stock market rather than overseas factors,’ said Lee Sun-yeob, an analyst at Shinhan Investment Corp.
U.S. Stocks hit new highs overnight after the number of Americans filing new claims for unemployment benefits fell more than expected last week.
Hyundai Mobis, a parts supplier, slumped as much as 7.1 percent, while Hyundai Motor declined 1.5 percent.
‘Overall, auto earnings are expected to miss forecasts for the January to March period, because of the stronger South Korean won. The yen’s slide is also hurting sentiment,’ said Cho Soo-hong, an analyst at Woori Investment & Securities.
‘Hyundai Mobis will suffer from a profit fall in its finance business, and lower earnings contributions from Hyundai Motor,’ he said.
Shipbuilders were also among the worst performers on the dim earnings outlook, with Samsung Heavy slumping 6 percent and Daewoo Shipbuilding falling 4 percent.
‘Shipbuilders will find it difficult to improve their earnings for the time being and their profitability is highly likely to stagnate for the next two years unless they post big jumps in orders,’ Lee Sang-hwa, an analyst at Hyundai Securities said in a report on Friday.
Shares of GS Engineering & Construction extended their slide, falling the daily limit of 15 percent, after the builder posted a surprising operating loss for the January to March period, hit by losses on large overseas plant projects.
(agencies)
Follow our WhatsApp channel