Financial shares, autos push stocks higher
Seoul stocks closed 1.3 percent higher yesterday as investors scooped up financial shares and automakers, shrugging off concerns over dimmer corporate earnings outlooks, analysts said.Reversing earlier losses, the benchmark Kospi advanced 14.97 points to 1,182.68. Volume was moderate at 353.6 million shares worth 3.9 trillion won ($2.89 billion), with gainers outpacing losers 544 to 265. The index gained ground for the second straight day.
“Gains of financial shares led the market’s upward movement. But there are still cautions against weaker corporate earnings outlooks for large caps,” said Bae Sung-young, an analyst at Hyundai Securities.
“Whether the Kospi stays above the 1,200-point mark hinges on how smoothly the earnings season passes and the stabilization of overseas markets. Otherwise, the local key index is likely to trade in a tight range for a while.”
Korea’s listed companies are set to announce their fourth-quarter earnings starting today, led by top steelmaker Posco. After volatile trading, Posco closed 0.5 percent higher. Financial shares closed on a positive note. KB Financial Group, the holding company of Kookmin Bank, advanced 5.2 percent and No. 2 financial services company Shinhan Financial Group jumped 5.8 percent.
Carmakers gained ground with industry leader Hyundai Motor advancing 4.4 percent. Kia Motors, Hyundai’s smaller affiliate, rose 3.9 percent. The company said it will slash production at domestic factories by 24 percent from a year earlier as demand slows. LG Chem, Korea’s biggest chemical maker, rose for the third day, advancing 1.4 percent. The stock’s 12- month share price target was raised to 68,000 won from 60,000 won at Citigroup, citing its hybrid car-batteries investment. LG Display, the world’s second-largest maker of liquid-crystal displays, climbed 4.1 percent.
Eugene Corp., a maker of construction materials, advanced 3.9 percent. The company sold a stake in its brokerage unit for 50 billion won ($37 million) to raise working capital. The 8.6 percent stake in Eugene Investment and Securities was sold to Korea Investment and Credit Capital, a Jeonju-based leasing company, at 1,000 won a share, Eugene said in an e-mailed statement.Yonhap, Bloomberg
with the Korea JoongAng Daily
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