Active Foreign Buying, Weaker Won, S-N Detente Propel Index


By Lee Hyo-sik
Staff Reporter



Korea Exchange officials look at a monitor showing stock prices at the exchange’s headquarters in Yoido, Seoul, Thursday. The Korea Composite Stock Price Index (KOSPI) closed up 1.13 percent at 1,061.93. / Korea Times

Seoul stocks closed sharply higher as Hynix Semiconductor and other large-cap stocks paced the market’s gains, pushing the benchmark index to the highest level in 10 years and seven months, analysts said.
The Korea Composite Stock Price Index (KOSPI) gained 11.77 points, or 1.13 percent, closing at 1,061.93 Thursday.

It is the highest closing point since Dec. 7, 1994, when it closed at 1,068.93.

The 100-share blue chip KRX 100 also added 24.8 points to 2,156.20 and the tech-heavy Kosdaq index closed up 2.5 points, or 0.48 percent, to 524.37.

``Active foreign buying enabled the bourse to maintain upward momentum throughout the day, even though program selling held the index back briefly after it exceeded the 1,060 point-mark,’’ Daishin Securities analyst Yang Kyung-shik said. ``We have a very strong market here.’’

Yang said that the local bourse is likely to undergo several brief correction periods over next few trading sessions before resuming its ascent.

Investor sentiment was also buoyed by an overnight rally on Wall Street and lower oil prices, analysts said.

U.S. stocks closed higher on Wednesday after the U.S. government’s report that the trade account deficit shrank to $55.3 billion in May, lower than its earlier forecast.

The Dow Jones Industrial Average rose 0.41 percent, and the tech-heavy Nasdaq index inched up 0.04 percent from the previous day’s close.

Crude oil futures for August delivery in the U.S. fell 61 cents to $60.01 per barrel on Wednesday’s trading.

Foreign Investor sentiment was also boosted by the recent news that North Korea has agreed to return to the six-party talks, easing geopolitical tension surrounding the Korean Peninsula.

The won’s recent weakness against the dollar raised hopes that export-oriented stocks will perform better as the falling won bolsters export earnings in won terms.

Hynix, the world’s second-largest memory chip maker, jumped more than 8 percent on a report that STMicroelectronics, Europe’s leading chipmaker, seeks to take over a stake in the domestic chipmaker.

Hynix closed up 8.4 percent at 22,050 won, while Samsung Electronics ended unchanged at 547,000.

Most other blue chips closed higher. Hyundai Motor closed up 2.8 percent at 66,400, and Hyundai Heavy Industries closed up 3.4 percent at 55,600.

Banks also closed sharply higher. Kookmin Bank ended up 2.6 percent at 51,400, and Shinhan Financial Group rose 2.3 percent to 29,050.

leehs@koreatimes.co.kr