Investors hold breath before Greek election

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Investors hold breath before Greek election

Korean stocks gained 0.7 percent yesterday as investors remained calm in the face of mounting euro zone woes and took a wait-and-see stance ahead of the Greek elections, analysts said. The local currency rose against the U.S. dollar.

The benchmark Kospi, after a choppy session, moved up 12.16 points to 1,871.48. Trading volume was light at 4.14 million shares worth 4.77 trillion won ($4.09 billion), with gainers outpacing losers 432 to 379.

“The downgrading of Spain’s sovereign rating and other events surrounding euro zone countries has not seriously affected the local bourse,” said Song Chang-sung, an analyst at Hanyang Securities.
He said that the market expected such a development and was not overly alarmed.

This view was echoed by Kim Sung-bong, an analyst at Samsung Securities, who said recent events taking place in Spain and Greece have all been reflected in the bourse.

“There is speculation that Italy may request a bailout, but investors are maintaining a waiting stance to see what action will be taken by Europe,” he said.

Others said that because of uncertainties surrounding the outcome of Greece’s elections slated for Sunday, and the European summit to be held early next week, the Kospi will likely swing from gains to losses for the time being.

Big-cap shares in steel, chemicals, refineries and financials moved up, but electronics and autos lost ground.

Global steelmaker Posco rose 2.3 percent to 376,500 won while LG Chem, a leading manufacturer of rechargeable batteries, added 2.3 percent to 288,500 won.

Hyundai Heavy Industries, the world’s largest shipmaker, closed up 1.3 percent at 272,500 won, with leading refiner SK Innovation jumping 2.5 percent to 144,500 won.

Shinhan Financial Group gained 2.3 percent to 40,200 won, with Samsung Fire & Marine Insurance moving up 1.7 percent to 205,000 won.

Market bellwether Samsung Electronics, however, fell 0.8 percent to 1,261,000 won, with leading carmaker Hyundai Motor finishing down 0.2 percent at 238,000 won. Hyundai Mobis, the country No. 1 car parts makers lost 0.9 percent to 270,000 won.

The local currency finished at 1,166.3 won to the U.S. greenback, up 2.1 won from Wednesday’s close.

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