South Korean stocks jumped more than 1.3 percent Thursday as uncertainties surrounding the U.S. Federal Reserve's policy direction eased following the release of its minutes that hinted at a potential rate hike. The local currency closed higher against the greenback.

The benchmark Korea Composite Stock Price Index advanced 26.03 points to 1,988.91. Trading volume was moderate at 414.7 million shares worth 5.06 trillion won ($4.32 billion), with gainers outpacing losers 587 to 231.

The Federal Open Market Committee's October minutes indicated a potential rate hike in December, which eased the market's uncertainties.

"The FOMC hinted it will seek a rate hike in a gradual manner.

This has eased the uncertainties in the market, lending support to investor sentiment," said Lee Hyun-joo, an analyst at NH Investment & Securities Co.

Foreigners offloaded a net 12.5 billion won, while retail investors sold a net 424.5 billion won. Institutions bought more shares than they sold at 295.2 billion won.

Tech shares closed higher, with top market cap Samsung Electronics adding 0.62 percent to 1,289,000 won, and chipmaker SK hynix increasing 2.13 percent to 31,200 won. No. 2 tech firm LG Electronics added 3.87 percent to 56,300 won.

Carmakers were also among winners, with industry leader Hyundai Motor advancing 0.95 percent to 159,500 won and auto parts arm Hyundai Mobis increasing 0.6 percent to 252,000 won. No. 2 carmaker Kia Motors rose 1.26 percent to 56,400 won.

Shipbuilders also closed higher, with Hyundai Heavy Industries moving up 3.33 percent to 93,200 won and Samsung Heavy Industries increasing 1.71 percent to 11,900 won. Daewoo Shipbuilding & Marine Engineering edged up 2.91 percent to 6,010 won.

No. 1 steelmaker POSCO advanced 1.19 percent to 169,500 won, and Korea Zinc moved up 1 percent to 453,500 won. Hyundai Steel increased 3.43 percent to 51,200 won.

The local currency ended at 1,161.70 won against the greenback, up 10.5 won from Wednesday's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys lost 1.6 basis points to 1.736 percent and the return on the benchmark five-year government bonds shed 2.9 basis points to 1.935 percent. (Yonhap)