Seoul stocks sink over 2 pct on chip losses

South Korean shares experienced a significant drop of over 2 percent on Monday, marking the end of a four-day winning streak. The Korea Composite Stock Price Index (KOSPI) fell by 191.18 points, or 2.7 percent, closing at 6,889.74. The decline was primarily driven by foreign and institutional investors capitalizing on profits from large-cap tech shares. The KOSPI's winning streak, which had lasted until Wednesday, was interrupted for Thursday and Friday as the country observed the Chuseok holiday.

The recent drop in shares can be attributed to several factors, including rising bond yields and uncertainty surrounding the Middle East crisis. On Friday, U.S. stocks managed to end higher, with the Dow Jones Industrial Average gaining 0.93 percent, the S&P 500 rising 0.51 percent, and the tech-heavy Nasdaq Composite Index increasing 0.48 percent.

However, the U.S.-China and U.S.-Iran relationships showed signs of easing, yet the sharp rise in U.S. Treasury yields dampened investor risk appetite and counterbalanced the positive factors.

The trading volume for the day was light, amounting to 216.2 million shares valued at 21.8 trillion won (US$15.9 billion). Winners outnumbered losers by a ratio of 608 to 249. Foreign investors and institutions collectively sold a net of 4.2 trillion won, while domestic investors invested 2.6 trillion won. Notably, Samsung Electronics, a market bellwether, saw its shares decrease by 5.43 percent to 270,000 won.

Its chip rival, SK hynix, fell by 5.05 percent to 1.77 million won, following a higher opening price. SK Square, the parent company of SK hynix, experienced the steepest decline, falling by 7.56 percent to 1.1 million won. As of 3:30 p.m., the Korean won was quoted at 1,365.1 won per U.S. dollar, marking a 7.6 won decrease from the previous trading session's close.