SEOUL, July 2 (Xinhua) -- South Korean stocks hit the lowest of this year Monday amid growing concerns over U.S. protectionist moves, with the local currency depreciating to the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) shrank 54.59 points, or 2.35 percent, to settle at 2,271.54. Trading volume stood at 390 million shares worth 5.9 trillion won (5.3 billion U.S. dollars).
It was the lowest close since May 10 last year. During the day alone, about 36 trillion won (32 billion U.S. dollars) worth of market capitalization evaporated.
The KOSPI, which took a weak start, extended its initial loss throughout the trading day on rising worry about the U.S. protectionist move.
Hyundai Motor, the country's No.1 carmaker, and its affiliate Kia Motors, presented a written statement to the U.S. Department of Commerce over the weekend, saying that if Washington slaps tariffs of 25 percent on imported cars and auto parts, it would inevitably deal a blow to the U.S. labor market.
Under instruction from U.S. President Donald Trump, the Department of Commerce initiated a so-called Section 232 investigation in late May into the implications of car and auto parts imports to the U.S. national security.
The probe was based on a rarely-used Section 232 of the Trade Expansion Act, which can lead to the imposition of as high as 25 percent of tariffs on imported vehicles and car parts.
Hyundai said it manufactures nearly half of the cars it sells in the U.S. market in the U.S. soil, employing over 25,000 U.S. workers for the operation.
If put in place, the tariffs would drive up the production costs of U.S. plants which could lead to a drop in profitability and ultimately prompt it to slash employment and investment, according to the South Korean carmaker.
Most of large-cap shares lost ground. Hyundai Motor lost 1.6 percent, and market bellwether Samsung Electronics declined 2.4 percent. Memory chip giant SK Hynix dipped 2.3 percent, and the biggest steelmaker POSCO tumbled 4.3 percent.
Leading chemical firm LG Chem plunged 4.8 percent, and Samsung Biologics, a biosimilar unit of Samsung Group, the country's biggest family-controlled conglomerate, retreated 0.6 percent.
Institutional investors dumped stocks, while individual investors were net buyers. Foreign investors purchased stocks in the spot market, but they were net sellers in the KOSPI 200 index futures market.
South Korea's currency finished at 1,120.0 won against the greenback, down 5.5 won from the previous close.
Bond prices ended mixed. Yields on the liquid three-year treasury notes added 0.1 basis point to 2.123 percent, but the return on the 10-year government bonds lost 2.6 basis points to 2.530 percent.
