Construction and Nuclear Power Stocks Slide Together as Westinghouse Electric Company Stake Falls Short of Expectations [Stocks NOW]

[Financial News] Construction stocks, including Hyundai Engineering and Construction, Daewoo Engineering & Construction and GS Engineering & Construction, were broadly lower during trading. Related stocks that had risen on expectations of expanded South Korea-U.S. cooperation in nuclear power appear to be facing selling by disappointed investors after the size of the Westinghouse Electric Company stake acquisition fell short of expectations.
According to the Korea Exchange (KRX) on the 23rd, Hyundai Engineering and Construction was trading at 123,000 won as of 10:26 a.m., down 8,300 won, or 6.40%, from the previous day in the stock market. Construction stocks broadly declined, with GS Engineering & Construction down 6.68%, Daewoo Engineering & Construction down 6.63% and Samsung E&A down 3.92%.
The two countries have reportedly agreed on the scale of the construction of eight nuclear power plants and the allocation of reactor types, which the government reported to the National Assembly as the "second U.S. investment project." However, they failed to narrow their differences over the size of the South Korean side's stake acquisition in Westinghouse Electric Company, a U.S. nuclear power company.
In particular, while South Korea was initially expected to acquire around 20% of Westinghouse Electric Company, it is now reportedly set to secure only about 5% to 10%. Whether it will gain a seat on the board has also not been decided.
With the stake reduced, questions are being raised about whether South Korea will have enough influence to secure more favorable terms for technology fees and cooperation on overseas orders. As a result, expectations for the orders and profits that domestic companies can secure appear to be weakening.
In fact, not only construction stocks but also nuclear power beneficiaries, including KEPCO Engineering & Construction (KEPCO E&C), down 4.34%, and Doosan Enerbility, down 4.05%, were also weak on the day.
Lee Seung-woo, head of the research center at Eugene Investment & Securities, said, "The stake was not as large as expected," but added, "We believe it is important in itself that South Korea has become a shareholder with some voting rights and is participating in a plan to build up to eight nuclear power plants in the United States."
[email protected] Joo Won-gyu Reporter