SEOUL: Seoul shares advanced on Friday, with investor sentiment buoyed by a long-awaited agreement among European leaders to help contain the region's two-year debt crisis, but analysts cautioned against excessive optimism.
"[The European agreement on a debt deal] is just the beginning. There are still potential issues, such as how European banks will fare during the debt resolution efforts," said Kim Hyoung-ryoul, a market analyst at NH Investment & Securities.
Euro zone leaders struck a last-minute deal on Thursday to contain the currency block's two-year-old debt crisis but are now under pressure to finalise the details of their plan to slash Greece's debt burden and strengthen their rescue fund.
"The market may move more cautiously in November," Kim said.
The Korea Composite Stock Price Index (KOSPI) was up 0.8 percent at 1,938.00 points as of 0247 GMT, after hitting as high as 1,963.74 points, a fresh 12-week peak.
Foreign investors were buyers of a net 188.4 billion won ($168.9 million) worth of shares, poised to purchase stocks for a second straight session, and retail investors were sellers of a net 468.7 billion won, set to sell for a fifth consecutive session.
Samsung Electronics gained 1.3 percent after its third quarter results showed it surpassed Apple Inc as the world's top smartphone maker with more than 40 percent shipment growth. It also forecast strong sales in the fourth quarter.
"We expect to see earnings improve slightly in the fourth quarter, and strongly in 2012. Its telecommunications devices business will continue to do very well, and so will non-memory chips," said Lee Sun-tae, an analyst at Meritz Securities.
Shares in conglomerate-affiliated technology service firms weakened after the government said it planned to limit their participation in government projects.
SK C&C lost 5.5 percent and POSCO ICT fell 2.9 percent.
Shares in SK Innovation advanced 2 percent after the country's No.1 crude oil refiner reported an over 500 percent year-on-year jump in third quarter net profits.
Brokerages rallied on the back of the stock market's solid performance. Woori Investment & Securities rose 4.1 percent and Samsung Securities advanced 3.3 percent.
Shares in KB Financial Group rallied 5.2 percent ahead of its quarterly results announcement later in the day.
The parent of South Korea's top mortgage lender Kookmin is expected to report stabilising earnings for the third quarter on Friday, after a brutal 2010 on the massive job cuts and soured construction loans.
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