South Korean shares rose 1 percent to their highest close in more than three months on Friday, as a weaker won currency and lower oil prices lifted exporters such as Hyundai Motor. The trend in the currency and energy market also raised confidence among investors of an economic recovery and improving earnings in the second half of the year.
Top-ranked non-life insurer Samsung Fire and Marine Insurance Co surged 7.27 percent to 90,000 won, after hitting a 52-week high of 90,500 won, after its May net profit released late on Thursday topped analysts' expectations.
"A weaker won helps Hyundai Motor and a lot of other export-driven companies," said Kim Hyun-tae, a fund manager at Landmark Investment Management.
"People are gaining trust in this market," he added. The benchmark Korea Composite Stock Price Index (KOSPI) ended up 0.98 percent at 1,018.02, its highest close since 1,019.69 on March 14.
It was the market's fourth consecutive winning session, with shares ending 1.5 percent higher for the week. Hyundai Motor Co rose 1.74 percent to 58,500 won.
South Korea's top auto maker said late in the session it had sold 18 percent more vehicles in June than a year ago.
Other exporters also rose on hopes a weaker South Korean won would improve their competitiveness overseas.
Samsung Electronics Co Ltd rose 1.42 percent to 501,000 won its highest close in over two months. Exporters were also helped after oil prices dropped sharply for a third consecutive session. Oil was trading at $56.66 in Asia after reaching an all-time record of $60.95 on Monday. State-run power provider Korea Electric Power Corp rose 3.63 percent to 32,850 won.
South Korean exports are expected to show double-digit growth in the year through the second half, the commerce ministry said on Friday. It said exports rose 10.4 percent in the year through June, slowing from May on weaker global demand.
Meanwhile, financial stocks gained, as investor's bet on a domestic demand-led economic recovery, analysts said. Mid-sized Hanna Bank rose 1.44 percent to 28,100 won. Its chief executive told Reuters second-quarter earnings would outperform first quarter results. Among other gainers, oil refiner SK Corp rose 2.19 percent to 56,000 won after it said it planned to start commercial production in Brazil from 2007.
The offshore project is estimated to have 50 million barrels in oil reserves. The junior and tech heavy Kosdaq market also extended its winning streak to a fourth day, rising 0.85 percent to 507.51, its highest close in more than four months.
The strong overall gains offset initial disappointment that the Federal Reserve did not signal an end to its policy of interest rate increases, after raising rates by a widely expected quarter point to 3.25 percent on Thursday.
South Korea's finance ministry said on Friday the impact on the economy and financial markets from rising US interest rates would be small.
Trade volume reached around 488.7 million shares worth 2.6 trillion won, compared to 507.1 million shares worth 2.6 trillion won on Thursday.
Gainers outnumbered decliners by 470 to 259 with 72 titles ending unchanged. Foreign investors bought a net of 113.2 billion won in shares on the main bourse, data showed.
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