Markets celebrate hope of big subprime bailout

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Markets celebrate hope of big subprime bailout

Seoul’s stock markets have risen for two straight days as expectations mount that U.S. President George W. Bush will introduce measures to ease the fallout from the subprime mortgage crisis.
The benchmark Kospi surged 31.54 points, or 1.7 percent, to end at 1,873.24, as investors awaited comments by U.S. Fed chairman Ben Bernanke, who will make a speech at the central bank’s annual conference in Wyoming on Friday.
Other Asian markets rose on speculation Bush would let the Federal Housing Administration, which insures mortgages for middle-to-low income borrowers, guarantee loans for delinquent borrowers, allowing them to dodge foreclosure and refinance at favorable rates. Japan’s Nikkei 225 added 2.6 percent and Hong Kong’s Hang Seng index hit a record.
Samsung Electronics, Korea’s largest firm by value, climbed 3.3 percent while No.2 Posco gained 2.9 percent. Other blue chip shares gained heavily. Korea Electric Power Corp. rose 2.4 percent and Kookmin Bank, Korea’s largest lender, rose 1.6 percent. SK Telecom, Korea’s largest wireless operator, gained 1.5 percent.
Shares of major retailers rose amid hopes of a recovery in domestic spending. Lotte Shopping gained 1.9 percent and Hyundai Department Store soared 6 percent. Shinsegae spiked 2.5 percent. Stock brokerage houses also jumped higher. Hyundai Securities rose 4 percent, and Woori Investment & Securities added 3.3 percent.
Trading volume was 352.2 million shares, worth 6.1 trillion won. Advancers led decliners, 566 to 214.
The tech-junior Kosdaq rose 9.53 points, or 1.2 percent, to close at 775.13. Hanarotelecom rose 0.9 percent and Seoul Semiconductor surged 6.3 percent.
Trading volume was 610.8 million shares, worth 1.9 trillion won. Gainers beat losers, 593 to 335.


By Jung Ha-won Staff Writer [hawon@joongang.co.kr]
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