Stocks rise for a second day as inflation worries wane

Finance

Published: 31 May. 2021, 18:10 Updated: 31 May. 2021, 19:31

Stocks rise for a second day as inflation worries wane

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 3,203.92 points on Monday, up 15.19 points, or 0.48 percent, from the previous trading day. [NEWS1]

Stocks advanced for a second straight day Monday after a choppy session, as investors lean towards the belief that recent signs of inflation are temporary. The won rose against the dollar.

The benchmark Kospi rose 15.19 points, or 0.48 percent, to close at 3,203.92 points.

Trading volume was moderate at about 1.1 billion shares worth some 13.8 trillion won ($12.4 billion), with gainers outnumbering losers 505 to 342.

Foreigners bought a net 520 billion won, while institutions offloaded a net 781 billion won. Retail investors purchased a net 259 billion won.

Stocks got off to a weak start and continued choppy trading, as investors wonder whether signs of inflation may sap demand for risky assets.

The U.S. personal consumption expenditures (PCE) index picked up 0.6 percent in April, marking the fastest on-year jump since 2008.

The Kospi firmly gained ground in the afternoon in the belief that it is too early to take the recent price hikes as a potential trigger for the U.S. Fed's policy change.

"Investors seem to have decided that the increase in PCE is not strong enough to start the tapering talks, and the inflation is temporary at best," Shinhan Financial analyst Choi Yoo-joon said.

Samsung Electronics advanced 0.5 percent to 80,500 won, and chipmaker SK hynix added 1.6 percent to 127,000 won.

Naver added 1.26 percent to 362,500 won, and Kakao gained 0.82 percent to 123,000 won.

Pharmaceutical firm Samsung Biologics increased 2.18 percent to 845,000 won, and Celltrion edged up 0.37 percent to 274,500 won.

Chemical firm LG Chem shed 1.56 percent to 819,000 won. Hyundai Motor climbed 1.29 percent to 235,000 won, and Kia added 1.06 percent to 85,600 won.

The Kosdaq gained 4.32 points, or 0.44 percent, to close at 981.78.

The local currency closed at 1,110.9 won against the dollar, down 4.6 won from the previous session's close.

Bond prices, which move inversely to yields, closed mixed. The yield on three-year government bonds added 6.6 basis points to 1.228 percent, and the yield on the benchmark 10-year government bond fell 2.0 basis points to 1.58 percent.

BY LEE TAE-HEE, YONHAP [lee.taehee2@joongang.co.kr]