Prices in global stock markets, including in Korea, appear to have moved ahead of the real economy, said Bahk Jae-wan, Korea’s finance minister.

“We see some gap as financial markets have recently shown some strength, if not a rally, while the global economy is slowing due to uncertainties concerning Europe,” Bahk told reporters in Seoul today. “The recent gains may reflect investor expectations of improvement in the global economy and European debt crisis in the coming months, and may be due to increased liquidity arising from quantitative easing measures in advanced countries.”

Korea’s benchmark Kospi index has risen 11 percent this year, along with other indexes in the region, as U.S. economic reports beat estimates and optimism increased that Greece will get a second debt bailout.

Stocks in the Korean gauge trade at 9.9 times estimated profit, compared with about 8.4 times in September, according to data compiled by Bloomberg.

“We still see a lot of uncertainty surrounding Europe,” Bahk said. “Europe still has a long and bumpy road to travel to resolve its debt problems.” (Bloomberg)