A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 6,696.96 points on Aug. 24, down 215.99 points, or 3.12 percent, from the previous trading session.YONHAP
Stocks closed sharply lower Monday as disappointment over Samsung Electronics' shareholder return plan triggered a sell-off in semiconductors. The won rose against the dollar.
The Kospi dipped 215.99 points, or 3.12 percent, to 6,696.96.
Trade volume was light at 264.9 million shares worth 26.1 trillion won ($18.9 billion). Winners outnumbered losers 576 to 286.
After opening lower, the index extended losses as large-cap tech shares came under selling pressure from foreign and institutional investors, which offloaded a combined net 4.97 trillion won. Retail investors snapped up a net 3.32 trillion won worth of shares.
"The Kospi was weighed down by disappointment over Samsung Electronics' shareholder return plan announced last week, with other Samsung affiliates losing ground," said Lee Kyoung-min, an analyst from Daishin Securities.
On Friday, Samsung Electronics announced a shareholder return plan worth between 90 trillion won and 110 trillion won. It also said the company plans to distribute cash dividends of around 30 trillion won in the third quarter, but noted their exact size and structure will be finalized at a board meeting in October.
Despite the massive sum involved, investors seemed to have been let down as the company failed to provide details on a possible stock buyback, the analyst added.
Investors are keeping an eye on other external factors, such as the upcoming earnings release from chip giant Nvidia and the latest economic reading from the United States.
The United States saw the strongest growth in its service sector in nearly two years in August, with the Purchasing Managers' Index for the month, published by S&P Global on Friday, rising to 56.8.
Samsung Electronics' headquarters in Suwon, Gyeonggi is seen on July 30.YONHAP
Most large-cap stocks closed lower.
Samsung Electronics declined 8.7 percent to 257,000 won while SK hynix shed 3.41 percent to 1,671,000 won.
KB Financial inched down 0.73 percent to 163,100 won, Hyundai Motor retreated 0.24 percent to 414,000 won and Doosan Enerbility dipped 0.41 percent to 73,000 won.
In contrast, bio firms strengthened, boosted partly by a 3.2 trillion-won licensing deal Hanmi Pharm clinched with a U.S. Roche Group subsidiary.
The company jumped 29.96 percent, near the daily permissible limit, to 540,000 won, while other bio firms, such as Celltrion, added 0.88 percent to 194,000 won.
The local currency rose 4.1 won from the previous trading session to trade at 1,382.4 won against the greenback at 3:30 p.m.
