After off day, market gets back on track

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After off day, market gets back on track

Korean shares yesterday rebounded from the previous day’s fall to close more than 0.5 percent higher led by a foreign investors’ buying spree that continued for 40 straight trading days. While institutional investors off-loaded their investments, foreign and retail investors net purchased more than 120 billion won ($113 million) worth of shares in total.

The benchmark Kospi jumped 0.54 percent or 10.94 points to close at 2,046.69 yesterday. The slight increase in index came despite reports from China that policy makers are draining cash from the financial system amid signs of a pickup in the economy.

Prices of blue chip shares were mixed. Yesterday, major companies including LG Electronics, Hyundai Motor, and Posco announced their third-quarter earnings.

Shares of Samsung Electronics jumped 0.49 percent to close at 1.45 million won while shares of Posco went up 0.47 percent to 321,500 won. Shares of LG Electronics also increased 0.57 percent to 70,100 won. Shares of Hyundai Motor, however, went down 1.93 percent to close at 253,500 won while shares of Hyundai Mobis dropped 1.91 percent to 283,000 won.

Financial shares, meanwhile, gained ground. Shares of Shinhan Financial Group rose 1.42 percent to 46,500 won while shares of Hana Financial Group jumped 1.62 percent to 40,850 won. Shares of Woori Financial Group also increased 0.78 percent to 12,950 won.

Korea’s won, meanwhile, rose 0.49 percent from the previous day to the U.S. dollar to close at 1,061. In fact, in daily trading, Korea’s won touched a nine-month high on speculation that exporters are repatriating overseas income in anticipation the currency will strengthen further. Government bonds were steady.

The economy probably expanded 3.1 percent in the third quarter, the most since the end of 2011, according to the median estimate in a Bloomberg survey before data due today. The won has climbed 5.4 percent in the past three months, the best performance among Asia’s 11 most-traded currencies.

“Exporters may be selling their income as the won is forecast to strengthen,” said Choi Sung-hyun, a currency trader at Woori Bank. “Eyes are on China’s market, which may dim Asia’s economic outlook.”

BY LEE EUN-JOO, BLOOMBERG [angie@joongang.co.kr]
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