South Korean stocks rose to the highest level in two months on Wednesday as solid U.S. economic data underpinned prospects for the global recovery, analysts said. The local currency fell against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) gained 14.98 points or 0.75 percent to 2,001.20, the highest closing since March 29. Trading volume was moderate at 355.6 million shares worth 4.68 trillion won (US$4.14 billion) with gainers outpacing losers 460 to 350.
"Foreign investors expanded purchases of Seoul shares, tracking overnight gains in U.S. markets," said Bae Sung-young, a market analyst at Hyundai Securities Co.
The KOSPI gained as much as 1.17 percent at one point in the afternoon session, but it pared earlier gains near the market close. It ended above the 2,000 mark for the first time since late March.
Foreign investors snapped up a net 355.7 billion won worth of local stocks, helping the KOSPI trade higher throughout the session.
The Dow Jones industrial average hit a fresh record high on Tuesday on the Seoul shares hit 2-month high on recovery hope sack of improved economic data, as central banks in the eurozone and Japan reaffirmed their will to keep their monetary easing stances.
On home front, the KOSPI has been trading in a narrow range amid a lack of leads and weak corporate earnings. But stock markets in major economies such as Japan have been on a bullish run on ample liquidity, driven by their loose monetary policies.
The National Pension Service, Korea's largest institutional investor, said earlier in the day that it will raise the portion of stock investments to more than 30 percent by 2018 in a bid to boost its investment returns amid slowing economic growth and a long streak of low rates.
STX Pan Ocean, STX Group's troubled shipper, jumped by the daily limit of 15 percent to 3,150 won on speculation that the state-run Korea Development Bank would take over the shipper. Despite lingering concerns about the yen's slide, local exporters gained traction.
Market leader Samsung Electronics rose 1.89 percent to 1,512,000 won and flat panel giant LG Display gained 3.85 percent to 31,050 won. No. 2 carmaker Kia Motors rose 2.77 percent to 59,300 won.
But power monopoly Korea Electric Power Corp. declined 5.06 percent to 27,200 won as the government's Tuesday decision to halt operations of two nuclear reactors raised concerns about potential power shortages ahead of the summer peak season.
The local currency ended at 1,132.90 won to the greenback, down 6 won from Tuesday's close, as the dollar gained ground on the firmer U.S. data, dealers said. (Yonhap News)