S. Korean shares fall after Kim Jong-Il's death
SEOUL — South Korean shares tumbled 4.87 percent soon after the announcement that North Korean leader Kim Jong-Il had died.
The benchmark KOSPI fell 89.36 points to 1,750.60 minutes after the news before edging back up slightly.
North Korean state media said on Monday that the 69-year-old died of a heart attack on Saturday, plunging the impoverished nation into uncertainty.
The official Korean Central News Agency (KCNA) urged people to follow Kim's youngest son and heir apparent Kim Jong-Un, who is aged in his late 20s.
The North declared a period of national mourning from December 17 to 29.
South Korea's government went on an emergency footing after the shock news, the South's Yonhap news agency reported. It summoned a meeting of the National Security Council.
Deputy Finance Minister Choi Jong-Ku said authorities in Seoul would monitor financial markets.
The US dollar jumped to 1,199.00 Korean won after the news of Kim's death, from 1,164.30 before. It later eased to 1,175.90.
"Uncertainty is mounting, as there are worries over the direction of North Korea and its leadership," Ichiyoshi Investment Management fund manager Mitsushige Akino said.
"Investors are simply in a rush to liquidate their positions," he told Dow Jones Newswires.
At War
North and South Korea have remained technically at war since the three-year Korean conflict ended only in an armistice in 1953 and tensions between the two have been strained further since Pyongyang tested nuclear bombs in October 2006 and May 2009.
There have been diplomatic efforts to restart six-nation nuclear disarmament talks which the North abandoned in April 2009.
"The shock on the market will be inevitable in the short term," Hyundai Securities analyst Bae Sung-Young said.
"Judging from the past cases, I forecast the impact to last for two to three days only, but at the same time, this time it could be different since the leader's death came when the succession process still looks incomplete," he said.
