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Seoul shares to stay rangebound on U.S. rate woes next week

Oct. 31, 2015 - 10:59 By 옥현주

South Korean shares are expected to trade in a tight range next week as investors remain concerned over a possible U.S. rate increase, analysts said Saturday.

The benchmark Korea Composite Stock Price Index (KOSPI) closed at 2,029.47 points on Friday, down 0.54 percent from last week.

Earlier this week, the South Korean stock market gained ground on the back of upbeat data from China, the country's top trading partner.

The market, however, later edged down as investors took a wait-and-see approach on the Federal Open Market Committee, which eventually decided to keep the country's key interest rate.

The KOSPI continued to trade dull for the remaining week as institutions turned to net sellers of local equities.

But market behemoth Samsung Electronics Co.'s plan to buy back 11.3 trillion won (US$9.89) worth of its own shares in order to enhance shareholder value limited the overall decline.Analysts said investors are expected to continue to remain concerned as the U.S. may seek a rate hike in December.

"Despite the abated concerns on the Chinese economy, the U.S.

rate issue will drive the market to trade in a limited range," said Ko Seung-hee, an analyst at KDB Daewoo Securities Co.

Ko added Fed Chair Janet Yellen's speech on regulations scheduled for next may suggest a hint for the future of the U.S.

key interest rate, inducing investors to sit on the sidelines.

Foreign investors offloaded a net 62.4 billion won this week, while retail investors scooped up a net 33.7 billion won.

Institutions sold 22.8 billion won.

Electronics, machineries and pharmaceuticals were among major gainers, while constructions and logistics lost ground. (Yonhap)