Seoul shares down 2.3 pct despite FTSE entry

SEOUL, Sept. 18 (Yonhap) -- South Korean stocks closed more than 2 percent lower Thursday as spiraling market uncertainties overshadowed the economy's designation as a "developed market" by a global equity index compiler, analysts said. The
local currency plummeted against the greenback.
The benchmark Korea Composite Stock Price Index (KOSPI) plunged 32.84 points, or
2.3 percent, to 1,392.42, after falling to an intra-day low of 1,366.88. Volume
was heavy at 401.4 million shares worth 5.49 trillion won (US$4.79 billion), with
losers outpacing gainers 482 to 168.
"The AIG rescue plan apparently hasn't soothed mounting anxieties on Wall Street,
with its effects taking a toll on financial stocks in other regions," said Bae
Young-sung, an analyst at Hyundai Securities.
U.S. stocks dropped to a three-year low on Wednesday as the U.S. bailout of AIG
failed to calm market jitters. The Dow Jones industrial average plunged 4.06
percent and the tech-dominated Nasdaq composite index nose-dived 4.94 percent.
South Korea's inclusion in the Financial Times Stock Exchange (FTSE) advanced
market category did not seem to play a major role for the session's trading, as
rumors of the announcement have been floating around for some time now, according
to Bae.
FTSE announced earlier in the day that it will upgrade South Korea's status from
the emerging market category for the first time, effective September 2009. South
Korea, which is classified as one of seven "advanced emerging markets," has been
on a watch list for the upgrade along with Taiwan since 2004.
Financial stocks suffered hard from market jitters. Top lender Kookmin Bank
plunged 7.12 percent to 52,200 won and Woori Finance Holdings tumbled 9.91
percent to 11,950 won. Brokerage giant Mirae Asset & Securities was down 4.42
percent, ending at 93,000 won.
Tech, auto and other export-driven stocks were also dented. Hynix Semiconductor,
the world's No. 2 maker of computer-memory chips, went down 6.78 percent to
18,550 won, while its larger rival Samsung Electronics fell 1.52 percent to end
at 517,000 won.
The local currency closed at 1,153.3 won to the U.S. dollar, down 37.3 won from
Wednesday's finish, as foreign investors rushed to purchase the dollar after
dumping shares in the local bourse, dealers said.