Seoul stocks sharply rebound on dip-buying, ahead of Biden visit
Published : May 20, 2022 - 16:05
Updated : May 20, 2022 - 16:05
An electronic board showing the Korea Composite Stock Price Index (Kospi) at a dealing room of the Hana Bank headquarters in Seoul on Friday. (Yonhap)

South Korean shares advanced Friday as investors scooped up oversold stocks and pinned hopes for expanded business ties between South Korea and the United States. The Korean won steeply rose against the US dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) added 46.95 points, or 1.81 percent, to close at 2,639.29 points. After a volatile week from high inflation, the key stock index gained 1.35 percent from a week ago.

Friday's trading volume was moderate at about 743 million shares worth some 9.5 trillion won ($7.5 billion), with gainers outnumbering losers 654 to 189.

Institutions bought a net 837 billion won and foreigners purchased 194 billion won, while retail investors offloaded 1 trillion won.

The KOSPI's rebound came after Thursday's global stock plunge.

Overnight, the Dow Jones Industrial Average and the tech-heavy Nasdaq composite declined, largely on continued pressure on inflation hikes.

After a bullish start, the KOSPI increasingly gained ground Friday on advances by tech, auto and chemical heavyweights.

Institutions and foreign investors bought stocks as US President Joe Biden's visit to South Korea raised rosy expectations that key sectors, such as autos and batteries, would get a boost from the summit. The US is one of South Korea's two largest trade partners, along with China.

"Despite continued worries about stagflation (from high inflation pressure and weak growth), investors pinned high hopes on the Korea-US summit. Steel performed strong in particular on hopes of Biden's possible deregulation on the sector, and autos swelled on reports that Biden will meet with (Hyundai Motor Group Chairman) Chung Eui-sun," the Shinhan Investment research team said.

Most large caps closed higher in Seoul.

The KOSPI's top cap, Samsung Electronics, moved up 0.74 percent to 68,000 won, and battery giant LG Energy Solution jumped 4.45 percent to 434,000 won.

No. 2 chipmaker SK hynix advanced 1.35 percent to 112,500 won, and the country's largest automaker, Hyundai Motor, added 2.47 percent to 186,500 won. Chemical heavyweight LG Chem soared 8.57 percent to 545,000 won.

The local currency closed at 1,268.1 won against the US dollar, up 9.6 won from the previous session's close. (Yonhap)