Earnings reports in U.S. give Kospi upward nudgeKorean stocks closed higher yesterday as investors bought tech and bank shares after sentiment was lifted by better-than-expected U.S. earnings reports, analysts said.
The benchmark Kospi gained 10.11 points, or 0.57 percent, to 1,768.67. Volume was thin at 260.1 million shares worth 5.31 trillion won ($5.36 billion), with gainers outpacing losers, 414 to 372.
“The key index traded higher, backed by stronger earnings by U.S. firms, but it pared earlier gains in late trading as investors were waiting for earnings reports by major financial firms in the U.S.,” said Kang Moon-sung, an analyst at Korea Investment and Securities.
U.S. financial firms including Merrill Lynch and Citigroup plan to announce their first-quarter earnings later this week.
Tech blue chips traded in positive territory. Market leader Samsung Electronics advanced 1.5 percent to 661,000 won, and chip giant Hynix Semiconductor gained 0.9 percent to 28,050 won.
Bank stocks were in demand with top lender Kookmin Bank rising 1.98 percent to 66,800 won.
News on possible industry takeovers lifted the market. Daewoo Shipbuilding and Marine Engineering, the world’s third-largest shipbuilder, jumped 4.1 percent to 44,450 won after two family-run conglomerates, Hanwha Group and GS Group, said they are interested in acquiring the shipbuilder. The state-run Korea Development Bank, the main creditor, said recently it will soon name a lead manager for the stake sale of the shipyard.
The No. 6 nonlife insurer in Korea, First Fire and Marine Insurance, rose by the daily limit of 14.9 percent to 11,900 won after Meritz Fire and Marine Insurance said it plans to acquire the insurer. Meritz, the No. 5 nonlife insurer, plans to send a proposal to buy a 20.7 percent stake in First Fire in efforts to embrace deregulation of the capital market.
The tech-heavy Kosdaq slightly declined, down 0.11 point, or 0.02 percent, to 641.60.