Market roiled by rumor on Lee Kun-hee

Seoul’s main bourse rose for the fourth consecutive day on eased worries toward Great Britain’s vote to leave the European Union.

But a rumor that Samsung Group Chairman Lee Kun-hee had died shook the market temporarily, leading the stock price of Samsung Electronics to rise as high as 1,439,000 won ($1,252) at one point during the session. The company denied the rumor.

The benchmark Kospi closed at 1,970.35, up 0.72 percent from the previous trading day. It recovered to the 1,970 level for the first time in five days.

“Korea’s stock market will show a rise in the short-term due to relieved sentiment on Brexit as well as the government’s stimulus strategy,” said Jeon Se-woong, an analyst at KR Futures.

Foreign investors purchased a whopping 187.5 billion worth of shares on Thursday while institutional and individual investors shed 258 billion and 37.2 billion won worth of shares each.

Market bellwether Samsung Electronics closed at 1,425,000 won, sharply rising 2.08 percent due to the Lee Kun-hee death rumor. The rumor spread through social media and mobile messengers around noon. It said the group would announce Lee’s death at 3 p.m.

The company immediately denied the rumor but Korea Exchange asked the group to post a regulatory filing about the rumor. The deadline is today at noon.

Samsung C&T also shot up 4.68 percent to close at 123,000 won per share with Samsung Life Insurance increasing by 1.52 percent to 100,500 won.

Analysts say the rumor might have been started by investors trying to manipulate stock prices for profit-taking.

Hyundai Motor Group dropped 2.52 percent to 135,500 won per share. AmorePacific rose 0.58 percent to 431,500 won.

The secondary Kosdaq reached the 670-level also for the first time in five days on the back of continuous retail investors’ purchases.

It closed at 675.09 points, up 0.78 percent from the previous day. Pharmaceutical company Celltrion rose 1.8 percent while IT firm Kakao edged up by 0.9 percent.

The Korean currency appreciated 8.4 won to close at 1,151.8 won against the greenback.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]