Kospi slips amid Moody's 'negative' outlook on U.S.

Shares in South Korea finished lower amid concerns of a potential U.S. government shutdown. The local currency also depreciated in value.

Screens in Hana Bank's trading room in central Seoul show the Kospi closing at 2,403.76 points on Monday, down 0.24 percent, or 5.90 points, from the previous trading session. [YONHAP]

Shares finished lower Monday amid concerns of a potential U.S. government shutdown following a cut in Moody's rating outlook for the United States. The local currency depreciated in value against the dollar.

The Kospi slipped 5.90 points, or 0.24 percent, to close at 2,403.76.

Trading volume was slim at 299.3 million shares worth 5.8 trillion won ($4.37 billion). Losers outnumbered gainers 592 to 283. Institutions net purchased 35.5 billion won, while foreigners and individual investors net sold 31.3 billion won and 21.7 billion won, respectively.

The Kospi opened higher after the country's exports rose 3.2 percent on year to some $182 billion in the first 10 days of the month, led by a 1.3 percent increase in outbound shipments of semiconductors, raising hopes that the prolonged downturn in the industry may finally be coming to an end.

Investors remained cautious after Moody's cut its rating outlook for the United States to “negative” from “stable,” citing a political deadlock in Congress over spending as a potential risk to the nation's fiscal health.

The report came amid fears that the United States may face a government shutdown should Congress fail to pass a spending plan by Friday.

“The Kospi is showing shaky movements, unlike the U.S. stock market, which is showing a rebound toward the year's end,” DS Investment & Securities analyst Yang Hye-jeong said.

“The semiconductor sector is one that is continuing a positive trend despite increased volatility. The recent improvements in the Nasdaq performance may also be a positive signal for Korea's semiconductor industry,” she added.

In Seoul, large caps closed mixed.

Samsung Electronics fell 0.14 percent to 70,400 won, while SK Telecom gained 0.6 percent to 50,200 won.

Hyundai Motor slipped 0.23 percent to 173,300 won, with Kia staying flat at 77,000 won.

LG Energy Solution advanced 1.09 percent to 415,500 won, while Samsung SDI lost 0.71 percent to 417,700 won.

The local currency ended at 1,325.10 won against the dollar, up 8.30 won from the previous session's close.

Bond prices, which move inversely to yields, closed lower. The yield on three-year government bonds rose 1.3 points to 3.876 percent, and the return on the benchmark U.S. 10-year government bonds gained 2.1 points to 4.643 percent.

BY KIM JU-YEON, YONHAP [kim.juyeon2@joongang.co.kr]