South Korean stocks are expected to trade higher this week on abated concerns over the listed firms’ second-quarter earnings, analysts said.
The benchmark Korea Composite Stock Price Index closed at 1,910.81 points on Friday, up 2.2 percent from the previous week.
Earlier last week, Seoul shares gathered ground as the pledge by financial leaders of the Group of 20 to support growth boosted investor sentiment.
Market watchers earlier expected that local stock market will remain flat this week as Japanese Prime Minister Shinzo Abe’s ruling coalition won a majority in the upper house of parliament in an election Sunday.
Tokyo’s hawkish economic policy has been a major drag to the South Korean economy, which heavily relies on exports that compete with Japanese rivals in the global markets.
As the so-called Abenomics spurred the yen to fast depreciate, fears grew over its impact on South Korean exports.
Seoul shares also traded bullish as the country’s economy grew 1.1 percent in the second quarter from three months earlier, quickening from a 0.8 percent on-quarter advance in the first quarter, according to the Bank of Korea.
It marked the fastest quarterly growth since the 1.3 percent growth in the January-March period of 2011.
Weekly foreign net buying totaled 740 billion won ($666 million), and institutions also scooped up a net 95 billion won. In contrast, individuals sold a net 800 billion won.
Analysts said Seoul shares are expected to trade higher over the next week as the country’s second-quarter earnings have been meeting the market estimate, lending support to investor sentiment.
“The U.S. Federal Open Market Committee’s meeting slated for next week is likely to have a limited impact on the local stock market, as it is anticipated to maintain the previous stance (on the quantitative easing),” added Han Chi-hwan, an analyst at KDB Daewoo Securities Co.
Builders and steelmakers were the biggest winners this week, adding 6.9 percent and 4.3 percent, respectively. In contrast, power and gas companies and mobile carriers shed 1.1 percent and 0.3 percent. (Yonhap News)
