Park’s theme stocks hit the roofThe so-called Park Geun-hye theme stocks rose to their daily limits while those related to close aides to the president-elect, including Kim Sung-joo, the chairwoman and CEO of Sungjoo Group, rose sharply as well.
Child-related medical service and product manufacturers as well as IT and bio stocks also rose as these are areas that the president-elect had mentioned she would foster during her campaign.
In contrast the theme stocks of rival Moon Jae-in tumbled to their daily limits.
The benchmark Kospi although edged close to 2,000. The presidential election results showed limited influence as it barely moved yesterday. The Kospi closed 1,999.5 after adding 0.32 percent from the previous close. Foreign and institutional buyers were net buyers while retail investors dumped their shares.
EG Corporation saw its stock rise to the daily limit of 15 percent to close at 44,550 won ($41) yesterday on the tech-heavy Kosdaq. The company’s largest shareholder is Park’s younger brother Ji-man. The shares of Dayou Smart Aluminum and Dayou Automotive Seat Technology, which are owned by Park’s relatives, also rose 15 percent to 1,770 won and 1,745 won respectively.
Shares related to Park’s close aide Kim Sung-joo, who is the co-chair of Saenuri’s presidential campaign committee, also went up to its daily limit. Daesung Industries, which is owned by Kim’s older brother, shot up to the daily limit to close at 17,450 won. Daesung Holdings rose 10 percent to close at 8,750 won and Daesung Energy, both companies owned by her other brother Younghoon David Kim, rose 9 percent to close at 6,210 won.
Kim, an entrepreneur herself, runs Sungjoo Group which runs the luxury brand MCM. Thanks to Park’s campaign pledge of enhancing the child care industry, baby product manufacturers Boryung Medience and Agabang & Company also rose to the daily limit.
The financial regulator said even after the presidential election it will continue to investigate the irregular investments on political-themed stocks. A Financial Supervisory Service official said that the oversight agency will continue to monitor the market and will investigate the suspected irregular activities, particularly on stocks that are considered to be related to the president-elect.
Meanwhile, market experts say the results of the election will have a positive influence on the investment sentiment.
“As the previous ruling party has succeeded in maintaining power, anxiety over policy uncertainties will likely be reduced,” said Bae Jae-hyun, analyst at Hanwha Securities.
The analyst, however, added that although the election results may have a positive effect for now, for the market to continue to grow the inflow of foreign investments and the improvements of economic indexes of the U.S. and China are essential.
Park Joong-seop, analyst at Daishin Securities, said past presidential elections have shown that the market moves in the upward direction regardless of the election results.
“Although several sectors may see some movements as a result of the elected candidate’s campaign pledges, the influence on the overall market will be limited,” the analyst said.
By Lee Ho-jeong, Yonhap [email@example.com]