Seoul shares soar

Seoul shares closed up more than two percent on Friday, as a flood of foreign buy orders swept banking and tech shares higher and with investors appearing to have factored in a widely-expected US interest rate rise.
"Shares climbed on expectations the market would rally after next week's Fed meeting," said Yang Jun-won, a fund manager at Acquire-IMM Asset Management Co "Soft valuations and expectations of solid second-quarter corporate earnings from mid-July also attracted investors."
Most analysts expect the US central bank to raise interest rates by one-quarter of a percentage point at the meeting on June 29-30. The benchmark Korea Composite Stock Price Index (KOSPI) closed up 2.08 percent at 779.03 percent, ending the week five percent higher.
The market showed little reaction to news that US officials said North Korea threatened to test a nuclear device, which dampened hopes of progress at six-way talks in Beijing after a series of gestures aimed at resolving the crisis over the North's nuclear ambitions.
Foreign investors bought a net 253.7 billion won ($220.2 million) worth of shares and local institutions bought a net 120.5 billion won. Foreign buying on expectations for solid second-quarter earnings helped shares in Samsung Electronics Co Ltd, the world's top memory chip maker, close 2.66 percent higher at 482,000 won.
Rival Highness Semiconductor Inc rose 3.54 percent to 11,700 won while display maker Samsung SDI Co ended up 4.31 percent at 121,000 won. South Korea's top lender, Kookmin Bank, climbed 4.53 percent to 35,800 won as foreign investors viewed the stock as cheap after it fell to a 12-month intrude low of 32,600 on June 23.
A sub-index for the banking sector rose 3.11 percent despite some bearish views on 2004 earnings amid a prolonged slump in domestic consumption. "Buying banking shares is still a bit risky as it is not certain when local demand would show a meaningful recovery," said you Seeing-min, an analyst at Samsung Securities.
The world's fourth-biggest steel maker, POSCO, gained 4.84 percent to 151,500 won on expectations for additional steel price hikes and hopes for high interim dividends. Hyundai Motor Co overcame a weak start to end up 3.49 percent at 42,350 won as analysts played down the potential impact of a labour strike and stressed the auto maker's solid fundamentals.
Hyundai's unionised workers staged a three-hour strike on Friday seeking higher wages and plan to go on a full one-day walkout on Tuesday. Trade volume totalled at 300.2 million shares valued at 2.28 trillion won.