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Stocks gain and won rises on trade optimism

Nov 06,2019
Stocks gained for a fourth day to close at a six-month high Tuesday amid optimism the United States and China are inching toward an interim trade deal. The won rose against the dollar.

The Kospi rose 12.40 points, or 0.58 percent, to close at 2,142.64, the highest in nearly six months. Trading volume was moderate at 394 million shares worth 5.04 trillion won ($4.8 billion), with gainers exceeding losers 503 to 322.

Investors are upbeat over the prospect of at least a partial trade deal between the world’s two biggest economies.

If the first phase of a trade deal is signed in the United States in the coming weeks, it will further boost the Kospi index, analysts said.

“The local bourse suffered a choppy session in the morning due to profit-taking but turned upward on news that China’s stock market rallied on hopes for a trade deal with the United States,” said Lee Young-kon, an analyst at Hana Financial Investment Corp.

On Sunday, U.S. President Donald Trump said a trade deal, once finished, will be signed somewhere in the United States.

Commerce Secretary Wilbur Ross expressed optimism that the United States would sign a “phase one” trade deal with China in November and that licenses would be released “very shortly” for U.S. firms to sell components to Huawei Technologies.

Foreign investors bought a net 330 billion won worth of stocks. But institutions and individuals sold a combined 350 billion won worth of stocks.

Tech, auto and steel stocks led gains, with Samsung Electronics rising 0.8 percent to a 52-week high of 52,700 won and chipmaker SK Hynix climbing 0.5 percent to a yearly high of 85,100 won on hopes for a turnaround in the sector.

Among decliners, search engine Naver fell 1.8 percent to 161,500 won, state-run utility Korea Electric Power declined 0.2 percent to 25,250 won, and tobacco company KT&G shed 1.5 percent to 100,500 won.

The secondary Kosdaq gained 3.73 points, or 0.56 percent, to close at 672.18 won.

The local currency continued to gain against the dollar, closing at 1,157.50 won Tuesday, down 1.7 won from Monday’s close. In the previous session, the won rose 6.4 won to 1,159.20.

Bond prices, which move inversely to yields, closed higher.

The yield on three-year bonds declined 2.4 basis points to 1.524 percent, and the yield on 10-year bonds increased 6.3 basis points to 1.77 percent.

BY KIM BYUNG-WOOK, YONHAP [kim.byungwook@joongang.co.kr]


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