S.Korean firms’ shares lose value over THAAD: brokerage

Source:Xinhua Published: 2016/8/8 23:58:39

The shares of South Korean companies that depend heavily on Chinese consumers for revenue have lost 11.2 trillion won ($10 billion) in value since the decision between South Korea and the US to deploy Terminal High Altitude Area Defense (THAAD) in South Korea, the Xinhua News Agency reported on Monday.

Local brokerage Samsung Securities said in a report on Monday that 10 major stocks relevant to Chinese consumers totaled 50.6 trillion South Korean won in market capitalization as of August 5, down from 61.8 trillion won on July 7, a day before the THAAD deployment announcement.

During the same period, the benchmark Korea Composite Stock Price Index advanced 2.6 percent, while the 10 stocks posted an average decline of 18.2 percent.

South Korea's decision to deploy  THAAD by the end of 2017 came despite strong objections from China and Russia, which have repeatedly said the deployment damages their security interests and upsets the strategic balance in the region.

It caused concerns among investors that Chinese consumers would refrain from buying cultural products and industrial goods from South Korea as they place national interests before the popularity of so-called Hallyu, or "Korean Wave."

SM Entertainment, which manages girl group Girls' Generation and many other Hallyu stars, tumbled the most among the 10 stocks by 26.7 percent in the cited period.

Cosmetics giants Amore Pacific and LG Household & Health Care plunged 17.8 percent and 22.3 percent each, while YG Entertainment, which manages star Psy of "Gangnam Style," retreated 11.1 percent.

Posted in: Economy

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