Stocks rise on stimulus and vaccine optimism

Employee walks pasT the screen in the dealing room of Hana Bank in Jung District, central Seoul, Monday. [YONHAP]

Stocks closed sharply higher Monday on hopes of massive economic stimulus steps sought by the local government. The won fell against the dollar amid the growing tension between the United States and China.

The Kospi gained 24.47 points, or 1.24 percent, to close at 1,994.60. Trading volume was moderate at about 630 million shares worth some 7.84 trillion won ($6.3 billion), with winners outnumbering losers 517 to 303.

The index got off to a good start on renewed hopes of a vaccine for the new coronavirus.

Dr. Anthony Fauci, director of the U.S. National Institute of Allergy and Infectious Diseases, said the United States was on track to develop new coronavirus vaccines by late December at the earliest.

"Fauci's evaluation was the largest driving force in today's gains," NH Investment & Securities analyst Noh Dong-kil said.

Investor sentiment was further lifted after Korean President Moon Jae-in told his government to push for a third and possibly largest-ever supplementary budget.

"The bottom of the global economy is invisible. This is indeed an economic wartime situation," the president said in an annual national fiscal strategy meeting.

Foreign investors sold a net 142.1 billion won, becoming net sellers for a second consecutive session. Institutions and individuals purchased a net 36 billion won and 97 billion won, respectively.

Most large caps closed in positive territory.

Samsung Electronics rose 0.21 percent to 48,850 won, and No. 2 chipmaker SK hynix added 0.12 percent to 81,400 won. Hyundai Motor soared 1.59 percent to 96,000 won, while Kia Motors advanced 1 percent to 30,400 won.

Naver spiked 4.56 percent to 241,000 won, with Kakao jumping 8.50 percent to 268,000 won.

The local currency closed at 1,244.20 won per dollar, up 7.20 won from the previous session's close.

The secondary Kosdaq was up 11.31 points, or 1.60 percent, to close at 719.89.

Bond prices, which move inversely to yields, closed higher. The yield on three-year bonds lost 2.6 basis points to 0.815 percent, and the return on the benchmark 10-year government bond lost 1.2 basis points to reach 0.65 percent.

BY KIM YEON-AH, YONHAP [kim.yeonah@joongang.co.kr]