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Seoul shares hit yearly high

July 28, 2014 - 20:52 By Korea Herald
South Korean stocks closed at their highest this year on Monday on improved economic data from China, the country’s No. 1 trading partner, and growing anticipation on a string of stimulus measures unveiled by the government, analysts said. The South Korean won fell against the U.S. dollar.

The benchmark Korea Composite Stock Price Index gained 14.96 points, or 0.74 percent, to close at 2,048.81. Trading volume was moderate at 343.3 million shares worth 4.56 trillion won ($4.44 billion), with losers outpacing gainers 486 to 333.

Analysts said the rise came as investor sentiment was boosted by better-than-expected gross domestic product growth and manufacturers’ data from China.

“Chinese economic indicators imply the economy has hit the nadir and is on its way toward recovery,” said Bae Sung-young, an analyst from Hyundai Securities Co. “The (second-quarter) corporate earnings also came as no surprise, while investors are currently painting a rosy outlook for the third quarter.”

Analyst added such improved data was enough to overwhelm concerns over the prolonged geopolitical tension in the Middle East and Ukraine, while the South Korean government’s new economic stimulus measures also lent help.

The government allocated 41 trillion won for the economic stimulus plan to bolster domestic consumption, although it downgraded this year’s growth outlook to 3.7 percent from 4.1 percent.

Foreigners bought a net 171.9 billion won, while retail investors offloaded a net 267.2 billion won. Institutions scooped up a net 125.5 billion won.

Builders mostly gained ground, with Hyundai Engineering & Construction rising 3.7 percent to 64,400 won and Daewoo Engineering & Construction moving up 5.15 percent to 10,200 won.

Daelim Industrial added 4.33 percent to 91,500 won. Mobile carriers were mixed, with SK Telecom moving up 3.81 percent to 245,000 won and No. 3 LG Uplus moving down 0.11 percent to 8,970 won. No. 2 KT advanced 2.5 percent to 30,750 won.

Hotel Shilla, a hotel operator of the country’s biggest conglomerate Samsung Group, gained 2.84 percent to 108,500 won on the back of robust buying from foreign investors.

Tech shares traded bearish, with SK hynix falling 2 percent to 46,550 won and LG Display losing 4.49 percent to land at 31,900 won. Market behemoth Samsung Electronics, however, climbed 0.22 percent to reach 1,358,000 won.

Carmakers traded mixed, with Hyundai Motor falling 0.22 percent to 227,000 won and Kia Motors moving up 0.53 percent to 57,100 won. Hyundai Mobis shed 0.18 percent to 281,000 won.

The local currency ended at 1,026.30 won against the greenback, down 0.40 won from Friday’s close. Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys moved up 1.1 basis point to 2.505 percent, and the return on the benchmark five-year government bonds added 1.6 basis point to 2.728 percent. (Yonhap)