Seoul shares up

Seoul shares ended up 1.4 percent on Thursday after pulling back from gains of as much as 3.3 percent, as optimism about a resolution to Europe's debt issues waned and fluctuations in the local foreign currency market caused jitters. The Korea Composite Stock Price Index ended up 1.42 percent at 1,774.08 points. KOSPI 200 December futures rose 1.8 percent to 230.15 points.
The KOSPI 200 spot index advanced 1.5 percent to 228.58 and the junior Kosdaq market finished up 0.6 percent at 454.95 points. "We are sensing the popularity of US dollar-based assets is growing, and investors were quickly locking in gains made in earlier session and moving to the dollars," said Park Jung-woo, a market analyst at SK Securities.
"There is eagerness to secure liquidity amid uncertain times," said Kim Seong-bong, a market analyst at Samsung Securities. Foreign investors were sellers of a net 186 billion Korean won ($167.9 million) worth of stocks, offloading shares for an eighth consecutive session, the longest selling streak in nearly a month.
Sharp falls in banks pressured market as Shinhan Financial Group declined 4.4 percent and KB Financial Group fell 2 percent. Brokerages also eased. Woori Investment & Securities shed 4.3 percent and Samsung Securities lost 1.3 percent. But technology stocks rallied, led by Hynix Semiconductor, which jumped 6.3 percent after data from DRAMeXchange, an industry tracker, showed firm gains in spot prices of key DRAM chips.
"The data fuelled positive hopes about DRAM pricing. While sustained, significant gains could be difficult, a bottom may be near," said Lee Jeong, an analyst at Eugene Investment & Securities. Lee, however, cautioned against excessive optimism. "Given the current global economic backdrop, we see demand for tech products weakening in the second half it is not going to be pretty."
Shares in Samsung Electronics, the world's No 1 memory chip maker, rose 2.4 percent, and LG Display, the world's No 2 flat panel maker, advanced 2.4 percent. Crude refiners also posted substantial gains. "Refiners' third quarter earnings are seen rising significantly from the previous quarter, thanks to the easing of domestic fuel price regulations and improved refining margins," said Sohn Ji-woo, an analyst at SK Securities.
South Korean refiners have gradually raised domestic fuel prices since early July, when a three-month price cut expired. Shares in S-Oil jumped 11.5 percent and SK Innovation rallied 5.8 percent. But airlines and tour issues lost ground, as the gloomy global economic backdrop weakened the outlook for demand for overseas tours.