Seoul shares fall

Seoul shares fell on Tuesday led by banks on concerns about major US lenders' share offerings, while the South Korean central bank's widely expected decision to keep interest rates unchanged had a limited impact on markets. The Korea Composite Stock Price Index (KOSPI) finished down 0.82 percent at 1,403.51 points.
"Foreign investors turned net sellers today on the back of news that some major US banks were planning stocks offerings following their stress tests," said Lee Young, a market analyst at IBK Securities. Four big US banks on Monday said they would sell $6.55 billion of common stock and repay funds from the government's bank bailout program, after federal stress tests showed they can weather a deep recession without new capital.
"We may see the foreign capital inflow slow down for the time being as it flows back either to safer havens or to US financial markets amid an emerging need for capital," Lee added. Foreign investors sold a net 846 million won ($681,200) worth of shares, snapping a seven-session buying streak. "There is appetite to lock in profits at the index's psychologically significant 1,400-point level," said Lee Kyoung-su, a market analyst at Taurus Investment & Securities.
Analysts said the Bank of Korea's decision on Tuesday to keep the base rate steady at 2 percent had a limited impact on stock markets as it was widely expected. Losses were led by banks following news about major US banks' common stock offerings and their recent rallies.
Hyundai Motor, the country's top carmaker, finished up 0.93 percent. Hynix Semiconductor, the world's No 2 memory chipmaker, gained 2.46 percent. Citigroup raised its target price on NCSoft by 116.9 percent to 180,000 won from 83,000 won previously, and raised its 2009 net profit target by 91 percent to 130.6 billion won. Shares in NCSoft jumped 14.74 percent to 179,000 won and Neowiz Games shot up 14.85 percent. Institutions sold a net 79 billion won worth of shares and retail investors bought a net 127.6 billion won. Decliners led advancers 503 to 309, with 76 unchanged.
Trading volume stood at 754.8 million shares worth 6.5 trillion won compared with 668.4 million shares worth 6.9 trillion won on Monday. The KOSPI 200 June futures index ended 0.90 points lower at 180.50, and the KOSPI 200 spot index fell 1.62 points to 179.73. The junior Kosdaq market rose 0.43 percent to end at 526.18 points.