Good news elsewhere boosts the marketKorean stocks closed 0.11 percent higher yesterday owing to increasing expectations on global economic recovery as some advanced countries took stimulus moves. The local currency gained against the U.S. dollar.
The benchmark Kospi picked up 2.1 points to finish at 1,956.45.
Trading volume in the country stood at 332.7 million shares worth 4 trillion won ($3.7 billion).
According to analysts, the Kospi rose largely because of favorable economic indicators in the United States and China. The Dow Jones Industrial Average and Standard & Poor’s 500 indices reached record highs.
China’s upbeat trade records in April also boosted the Korean market.
Some said expectations that the Bank of Korea’s monetary policy committee will likely adjust the benchmark rate also had positive effects on the market.
Retail and institutional investors contributed to the rally, buying 182.3 billion won and 90.1 billion won worth of shares respectively.?
Despite the overall market rally, Samsung Electronics shares dipped 0.33 percent to finish at 1.48 million won. Hyundai Motor Group shares dropped 0.77 percent to 193,000 won .
Posco, the third-largest company on the Kospi, meanwhile, saw its shares rise 0.47 percent to 320,500 won. Shares of Hyundai Mobis, the fourth largest, also climbed 0.58 percent to 259,500 won.
Korea’s won rose to a two-month high as a global rally in equities boosted investor appetite for emerging-market assets. Government bonds dropped.
The currency’s advance for a fourth day prompted Kim Seong-wook, a director in the finance ministry, to say yesterday the government will closely monitor any “unnecessary movement” that increases exchange-rate volatility.
“The rise in stock markets around the world helped boost sentiment among investors to favor putting more money into riskier assets,” said Lee Dae-ho, currency analyst at Hyundai Futures in Seoul.
“Concerns that authorities may try to stem gains in the currency are keeping the won from rising further.”
By Song Su-hyun, Bloomberg [firstname.lastname@example.org]