The Kospi outshines its Asian peers

The Korean stock market racked up the best performance among its Asian peers last week on strong foreign buying and the easing of negative external factors, a market tracker said yesterday.

The benchmark Kospi finished the week 2.48 percent higher, marking the largest increase among Asian stock indexes and ranking sixth among 59 major bourses in the world, according to local financial information provider FnGuide.

Over the cited period, the U.S. Dow Jones industrial average gained 0.21 percent, while Japan’s bellwether Nikkei dropped 0.44 percent.

The Kospi’s increase was also much higher than Hong Kong’s 1.02 percent expansion, Thailand’s 1.8 percent gain and Vietnam’s 0.7 percent hike.

The Korean stock market’s stellar performance was attributed to brisk foreign buying, the yen’s slowing depreciation and the easing of geopolitical risks stemming from Pyongyang’s nuclear test. Of the 10 trading sessions in February, overseas investors were net buyers for eight days. Last month, foreigners were net sellers for 14 trading sessions out of a total of 22.

“The local stock market got a boost from weakened foreign selling and a slowdown in the yen’s fall,” said Kim Hyung-ryeol, chief investment strategist at Kyobo Securities. “Geopolitical risks on the Korean Peninsula also eased following North Korea’s nuclear test.”

On Tuesday, North Korea announced it carried out its third nuclear test.

Some market watchers said last week’s surge in the Kospi may point to the beginning of the end to the local bourse’s decoupling from global stock exchanges.

For the past one-month period, the Kospi fell 1.37 percent, striking a sharp contrast to a 3.45 percent surge in the Dow Jones industrial average, Nikkei’s 4.69 percent spike and a 5.22 percent jump in the Shanghai stock index. Yonhap