Kospi is up, but barely, as market stutters
Korean stocks closed marginally higher yesterday as strong institutional buying overshadowed the central bank’s interest rate freeze, analysts said. The local currency fell against the U.S. dollar, ending its four-day run of gains.The benchmark Kospi added 0.88 points, or 0.08 percent, to 1,128.39. “Massive institutional buying helped the key index end in positive territory after choppy trading,” Kwak Jung-bo, an analyst at Hana Daetoo Securities, said. “Market pessimism was relatively subdued as the won remained below 1,500 with relentless foreign selling calmed somewhat,” Kwak said.
Memory chip makers gathered substantial ground after the government of Taiwan was reported to give up its plan to merge the island’s unprofitable chipmakers. Samsung Electronics, Korea’s market bellwether, gained 2.1 percent, and Hynix Semiconductor rose 4.63 percent. LCD giant LG Display tumbled 6.5 percent, as its 10-year partner Philips sold its remaining 13.2 percent stake in the company.
Bank shares also finished lower on persistent jitters over the global banking sector. Woori Finance Holdings, the parent of Woori Bank, shed 4.35 percent, with Shinhan Financial Group finishing 1.29 percent lower. Hite Brewery Co., Korea’s biggest beermaker, surged the most in more than four months on speculation Lotte Group had dropped out of bidding for rival Oriental Brewery Co., reducing the threat of increased competition. Hite jumped 10 percent, the most since Oct. 30, 2008. An initial offer for Oriental Brewery by Lotte Group, parent of Korea’s biggest beverage maker Lotte Chilsung Beverage Co., was rejected by the seller as too low, two people with knowledge of the matter said.
“Should Lotte’s bid for Oriental be successful, that could pose the biggest threat for Hite, heating up competition in the beer market,” said Yoo Jin, a Seoul-based analyst at Goodmorning Shinhan Securities Co.
Trading volume was moderate at 484.1 million shares worth 5.9 trillion won ($3.9 billion), but losers outpaced gainers 439 to 384.
The Korean currency ended at 1,496.5 won to the greenback, down 25.5 won from Wednesday’s close, as importers snapped up dollars after the won’s recent gains, dealers said. Yonhap, Bloomberg
with the Korea JoongAng Daily
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