Seoul stocks slumped to their lowest close in 2 1/2 months on Monday, as grim earnings from Samsung Electronics and IBM sparked a sell-off in the tech sector, while worries about the US economy battered exporters. The benchmark Korea Composite Stock Price Index (KOSPI) fell 2.35 percent to close at 925.00, extending a losing streak to a sixth session that has wiped out 32.8 trillion won ($32.24 billion) in market value. The index fell as much as 3.15 percent at one point, before closing at its lowest since February 2 when it ended at 921.44.
"There's simply no good news. In the US, the economy seems to be slowing down. In the region, China and Japan are embroiled in a dispute," said Park Kum-yung, a fund manager at Mirae Asset Co.
"And in the tech sector, investors are pushing back their expectations for a recovery to sometime in the second half, later than many had hoped," he added.
Samsung Electronics Co Ltd, the world's top maker of memory chips, fell 3.15 percent to close at 476,000 won after reporting on Friday a worse-than-expected 52 percent drop in first-quarter earnings.
The results prompted several brokerages to downgrade Samsung's earnings, with Merrill Lynch cutting the chip maker to "neutral" on Sunday, citing weakness in memory chips and a potential margin squeeze in mobile handsets.
The stock has fallen 8.5 percent over the past four sessions.
Samsung's results came a day after International Business Machines Corp, the world's biggest computer firm, reported lower-than-expected earnings.
LG.Philips LCD Co Ltd, the world's number two flat panel maker, fell 2.22 percent to 44,000 won, after falling as much as 4.9 percent at one point.
LG Electronics Inc, the world's fourth-biggest mobile handset maker, fell 1.81 percent to close at 65,100 won ahead of its first-quarter earnings announcement on Tuesday.
The tech-heavy Kosdaq market dropped 4.31 percent to 429.73, its biggest one-day loss since falling 7.21 percent on May 17, 2004.
A steep drop on Wall Street to 5 1/2 months lows on Friday amid worries about the US economy also soured investor sentiment, weighing especially heavily on South Korean exporters.
Data out on Friday showed tepid US industrial production, while a separate survey showed a fall in consumer sentiment.
Shares in South Korean firms with significant exposure to China took a hit, with top local oil refiner SK Corp shedding 2.83 percent to 58,300 won.
A steady retreat in crude oil prices from recent record highs hit early this month also weighed on refiners.
Trade volume reached 365.3 million shares worth 2.2 trillion won compared to 377 million shares worth 2.5 trillion won on Friday. Losers outnumbered gainers by 694 to 76 with 36 titles ending flat.
Foreign investors sold a net 49.6 billion won on the main bourse, while retail investors sold a net of 45 billion won. Institutional investors bought a net of 91.8 billion won.
The June KOSPI 200 futures index fell 2.95 points to 119.50 and the underlying KOSPI 200 spot index dropped 2.65 points to 119.76.
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