Seoul shares rose to a five-week high on Thursday, backed by a foreign investor buying binge as hopes that the International Monetary Fund would beef up its lending capacity soothed euro zone worries. "Although a rally in US and European shares lent strong support, the mainstay behind the momentum was the huge purchases by foreign investors," said Lee Young-gon, a market analyst at Hana Daetoo Securities.
Strong US manufacturing data also backed risk appetite, with factory output in December growing at its fastest pace in more than a year. The Korea Composite Stock Price Index (KOSPI) rose 1.19 percent to close at 1,914.97 points, re-entering 1,900 point territory for the first time in more than a month and just shy of a five-week high touched earlier in the session. Foreign investors snatched up a net 709 billion won ($621 million) worth of shares, marking their largest single-day purchase since September and eighth straight session of buying.
Institutional investors reverted to net buying after selling on Wednesday, snapping up a net 90.9 billion won worth of shares. Semiconductor shares rallied, tracking US peers in the Philadelphia Semiconductor Index, which climbed 5 percent to its highest since July amid strong indications of rising DRAM prices. Hynix Semiconductor Inc soared 4.16 percent while Seoul Semiconductor Co Ltd jumped 9.93 percent.
Shares in Hi-mart Co, South Korea's largest electronics retailer, rose 3.36 percent on reports that the company will release preliminary bidding invitations for its sale. Eugene Corp, the majority stakeholder in Hi-mart, saw its shares spike up by the daily limit of 14.86 percent. Large-cap heavyweights lent support, as Samsung Electronics Co soared 4.08 percent and POSCO rose 2.78 percent. The KOSPI 200 index rose 1.39 percent to close at 251.27 while the junior KOSDAQ index snapped a three-day slump to close 0.49 percent higher.
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