[THE INVESTOR] South Korean share prices tumbled to near one-month low on June 16 on the cautious tone of the US Federal Reserve on the global economy amid rising risks involving Britain’s exit from the European Union.

The local currency closed at 1,171.4 won against the US dollar, up 1.9 won from the previous session’s close.

The benchmark Korea Composite Stock Price Index lost 16.84 points, or 0.86 percent, to close at 1,951.99, booking a sixth straight losing session. Trade volume was at 432.98 million shares worth 4.38 trillion won ($3.74 billion), with losers overwhelming winners 677 to 148.
The Fed kept interest rates unchanged on June 16 in a widely expected move, with Fed Chair Janet Yellen acknowledging Britain’s possible exit from the European Union as one of the factors for the latest decision.

The news that Tokyo’s Nikkei dropped 3 percent following the Bank of Japan’s meeting further pushed down the KOSPI in the afternoon, but foreigners turned to net buyers to pare some of losses.

“Investors are fleeing cyclical stocks and running toward safe havens in the short term due to uncertainties surrounding Britain‘s June 23 referendum and the global economic slowdown,” Kim Jung-hwan, an analyst at Mirae Asset Daewoo Securities, told the press. “The market will drift without direction for a while as investors are taking wait-and-see strategies ahead of major economic events.”

Institutions were the biggest sellers of the day, dumping a net 208.27 billion won. Foreigners bought a net 43.96 billion won, and retail investors picked up a net 115.2 billion won.

Samsung Electronics declined 0.28 percent to 1,409,000 won, and Hyundai Motor slipped 0.74 percent to 134,500 won.

Korea Electric Power Corp. rose 0.69 percent to 58,200 won, and AmorePacific, the nation’s largest cosmetic maker, gained 0.98 percent to 413,000 won.

Daewoo Shipbuilding & Marine Engineering tumbled 7.19 percent to 4,065 won after the state auditor said on June 15 it had uncovered a combined 1.5 trillion won accounting irregularity for the fiscal years of 2013 and 2014.

(theinvestor@heraldcorp.com">theinvestor@heraldcorp.com)