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Kospi rises thanks to good news from China

July 21,2018
Korea’s main bourse ended higher Friday for the first time in five sessions, as investor sentiment was buoyed by stronger Chinese stocks and yuan, despite ongoing trade disputes with the United States. The Korean won depreciated against the U.S. dollar.

The benchmark Kospi added 6.9 points, or 0.30 percent, to close at 2,289.19. Trade volume was slim at 4.83 trillion won ($4.27 billion).

Institutions scooped up a net 67.2 billion won and individuals bought a net 50.6 billion won worth of local shares, offsetting foreigners’ 121.5 billion won sell-off.

“The Chinese yuan recovered from its fall thanks to signs of the authorities’ intervention to prevent the currency from sliding further, and that seems to have helped the market reverse its losses,” said Lee Young-gon, an analyst at Hana Securities.

“Heading into the second-quarter earnings season, investors are picking up more shares, though lingering concerns over global trade spats have made them cautious,” Lee added.

Auto shares gained ground, as companies in the U.S. voiced dissent over Trump’s tariffs. Top carmaker Hyundai Motor jumped by 2.42 percent to 127,000 won and its smaller affiliate Kia Motors advanced 0.94 percent to 32,200 won.

Insurers and financial companies also won out. Samsung Life Insurance surged 1.88 percent to 97,300 won and Hanwha Life Insurance rose 1.03 percent to 4,920 won.

Woori Bank rose 0.61 percent to 16,500 won after reporting strong profits in the first half of this year. KB Financial Group added 0.56 percent to 53,900 won.

Steel and chemicals also lost ground. Korea’s steelmaker Posco sank 2.7 percent to 306,000 won and LG Chem shed 1.04 percent to 332,500 won.

Tech giants also had mixed fortunes. Market bellwether Samsung Electronics rose 1.17 percent to 47,450 won in a three-day winning streak, while SK Hynix dropped 2.66 percent to 87,900 won on profit-taking.

The secondary Kosdaq fell 4.88 points, or 0.61 percent, to 791.61, closing lower for the fifth straight session. Though the tech-heavy index initially rose on investors’ bargain buying of cheap pharmaceutical shares, large-scale foreign selling reversed the upward momentum.

The Korean won closed at 1,133.7 won against the U.S. dollar, up 0.5 won from Thursday’s close.

Bond prices, which move inversely to yields, ended higher. The yield on three-year bonds shed 1.2 basis points to 2.08 percent, and the return on 10-year bonds lost 1.8 basis points to 2.52 percent.


BY KIM EUN-JIN, YONHAP [kim.eunjin1@joongang.co.kr]


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