Seoul shares closed 1.1 percent lower on Monday, as major exporters such as Samsung Electronics Co Ltd and Hyundai Motor Co took a beating on renewed worries over the global demand outlook after poor US jobs data. US jobs data on Friday came in short of even the lowest forecast, dashing optimism that the economy was emerging from a soft patch and leaving investors to hope that earnings season will revive buying appetites.
A surge in China's inflation to a three-year high in June also chilled investor sentiment and raised prospects for another rate increase this year after the third hike last week. "Economic data kept investors jittery and led some to take profits from the market's recent gains," said Lee Yeon-shin, an analyst at Kyobo Securities.
"With foreign investors continuing their net buying of local stocks, rising momentum remains still intact and the market is likely to show some resilience and bounce back later this week." The Korea Composite Stock Price Index (KOSPI) declined 1.06 percent to close at 2,157.16 points, after rising for a third consecutive week last week.
KOSPI 200 September futures ended down 3.8 points at 284.45 points and the KOSPI 200 spot index fell 3.59 points to 282.46. The junior Kosdaq market ended up 0.31 percent at 498.37. Samsung Electronics, Asia's biggest technology company with $135 billion in market value, fell 2.3 percent and Hyundai Motor, the country's top automaker, dropped 3.4 percent.
LG Display Co Ltd, which vies to be the world's leading LCD flat screen producer with Samsung Electronics, dropped 3.7 percent after a report that it had lowered capacity run rates because of weak demand. Shares in SK Telecom Co Ltd, the country's No 1 wireless carrier fell 3.7 percent, dropping for a fifth consecutive session to an eight-year low, pummelled by its plan to buy a controlling stake worth $2.3 billion in Hynix Semiconductor Inc.