S.Korean shares relying on Chinese consumers fall after THAAD decision

South Korean stocks, which rely heavily on Chinese consumers for revenue, continued a downward trend on Monday after Seoul and Washington decided last Friday to deploy the U.S. missile defense system, called Terminal High Altitude Area Defense (THAAD), in the South Korean soil.

The decision boosted worries among stock traders about possible reduction in the number of Chinese people traveling to South Korea or a fall in exports to the world's second-largest economy and South Korea's largest trading partner.

LG Household & Health Care, the country's No.2 cosmetics maker, declined 3.6 percent after tumbling 4.5 percent the previous session. Other cosmetics companies lost ground on possible weakness in demand for South Korea-made beauty products.

Travel agency shares, including Hanatour Service, ended in negative territory on concerns about the fall in Chinese tourists visiting South Korea. It was in a stark contrast to the benchmark Kospi index gaining 1.3 percent on the back of positive employment data in the United States.

Cheong Seong-Chang, a senior researcher at the private Sejong Institute, said last week that the THAAD decision would cause a drop in Chinese tourists visiting South Korea, a cooling in the popularity of the so-called Korean Wave and the possible boycotting of South Korean products in China.

(APD)