Seoul shares down

Seoul shares fell on Thursday as losses by exporters on a rapid rise in the won outweighed gains by the beneficiaries of strength in the domestic currency, while KB Financial slid on rumours of a stake sale by an investor. The Korea Composite Stock Price Index (KOSPI) finished down 0.70 percent at 1,161.81 points.
"The won-dollar issue is like the two sides of a coin. The key is that anything excessive is not good. The rapid rise in the won we saw today caused some concerns about South Korean products price competitiveness. The won may not be on a longer-term upward trend, but investors do not like uncertainties," said Y.S.Rhoo, a market analyst at Hyundai Securities. The South Korean won ended local trade up 1.8 percent to hit its strongest close in over five weeks against the dollar.
"Hopes for stabilisation in economies are blowing through the market like a spring breeze, but the hard numbers arent indicating that just yet," Rhoo said, adding that the indexs position near its 120 day moving average of 1,150 points also prompted profit-locking activity.
Exporters led losses, with Hyundai Motor, South Koreas No 1 automaker, falling 4.62 percent and LG Electronics, the worlds No 4 maker of handsets, losing 5.41 percent. Steel issues also declined on the back of continued worries about a slowdown in steel demand, and following news late on Wednesday that Hyundai Steel, South Koreas second-largest steel firm, had cut hot-rolled coil prices by 14 percent in its first price reduction of the benchmark product in eight months due to demand weakness.
POSCO fell 2.52 percent and Hyundai Steel slid 1.92 percent. Meanwhile KB Financial Group sank 5.31 percent on speculation that ING Group might sell off its 5.06 percent stake in South Koreas No 3 financial holding firm. But shares in KT and KTF finished up 3.63 percent and 3.28 percent respectively, after the telecommunications regulator on Wednesday approved a merger between the two.
Tour issues also rose helped by the stronger won, with Hana Tour jumping 5.53 percent and Modetour ending 3.55 percent higher. Elsewhere Dongbu HiTek advanced 5.43 percent after a local media report that the semiconductor and biotechnology firm was seeking to sell a stake in unit Dongbu Metal to Korea Development Bank (KDB). A Donbu HiTek spokesman said the company had contacted KDB to discuss a sale, but had yet to reach any agreement.