Seoul shares posted their lowest close in over two months on Friday with financials leading declines, as investors fled for safety amid global market falls on escalating European sovereign debt worries. The Korea Composite Stock Price Index (KOSPI) finished down 3.05 percent at 1,567.12 points, the lowest close since November 30, 2009.
"Markets are being hammered by external negatives such as worsening worries about southern European countries including Greece and Spain. Conditions in general are growing poorer," said Lee Kyoung-su, a market analyst at Taurus Investment & Securities.
The number of US workers filing for jobless benefits unexpectedly rose last week, while deepening fears over the fiscal problems of debt-laden southern members of the eurozone hammered stocks in Portugal, Spain and Greece.
Foreign investors were sellers of a net 291.5 billion won ($249.4 million) worth of stocks following three sessions of buying, while institutions bought a 206.5 billion won. Banks led falls, with Woori Finance Holdings losing 5.54 percent and KB Financial Group tumbling 6.75 percent.
Shinhan Financial Group fell 5.2 percent after South Korea's largest financial services firm by market value posted a 10 percent fall in quarterly profit late on Thursday, due to additional costs to cover its exposure to embattled companies. Key large cap issues also retreated, with POSCO, the world's No 4 steelmaker, losing 4.02 percent and LG Display, the world's No 2 maker of LCD panels, sinking 3.08 percent.
Memory chip issues declined after losses in the key US semiconductor index. Shares in Samsung Electronics, the world's No 1 memory chip maker, fell 3.35 percent and Hynix Semiconductor, the world's No 2, shed 2.07 percent. Defensive issues outperformed as investors turned risk-averse. Shares in Amorepacific, a cosmetics maker, ended flat and snack maker Crown Confectionery rose 4.2 percent.
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