South Korean stocks rebounded Friday from the previous session, as the U.S. Senate's nod on the motion to appoint Federal Reserve vice chair Janet Yellen as the next head relieved investors' fear about an early stimulus cut, analysts said. The local currency rose slightly against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) advanced 12.45 points, or 0.62 percent, to close at 2,006.23. Trading volume was moderate at 342.2 million shares worth 3.38 trillion won (US$3.18 billion) with gainers outpacing losers 448 to 327. 

"The tapering fear that caused the KOSPI's fall the previous day is not a surprising factor. Any changes with the bond-buying program will likely hinge on the budget plan, for which Washington has till the end of the month to decide," said Han Beom-ho, an analyst at Shinhan Investment Corp.

The Seoul bourse dropped 1.16 percent on Thursday as the latest Fed minutes in which it said the scaling back of the quantitative easing (QE) could start in the coming months unnerved investors.

But the KOSPI again shrugged off concerns after the Dow Jones industrial average closed at an all-time high of above 16,000 overnight on positive economic data.

On the Seoul market, foreigners and retail investors sold off equities worth a net 15.5 billion won and 76.6 billion won each. In contrast, institutions bought a net 92.2 billion won, driving up the main index.

Domestic-focused stocks lent support to the bullish close.

State-run Korea Electric Power Corp. rose 3 percent to 32,700 won and leading apparel company LG Fashion soared 3.88 percent to 33,450 won.

Major large-caps closed mixed. Samsung Electronics climbed 0.69 percent to 1,450,000 won, while Hyundai Motor slid 0.2 percent to 253,000 won. 

The local currency ended at 1,060.20 won against the greenback, up 2.7 won from Thursday's close, mainly on the back of the KOSPI's gain, dealers said. (Yonhap News)