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Seoul shares rebound on recovery hopes

Korean stocks closed 2.2 percent higher on Thursday, recouping losses from earlier this week, as a series of encouraging economic data spurred strong foreign and institutional buying, analysts said. The local currency rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) jumped 42.42 points to 1,970.66. Trading volume was moderate at 277.2 million shares worth 5.13 trillion won ($4.6 billion), with gainers outnumbering losers 631 to 216.

“The upbeat economic data that was released ahead of the market opening buoyed investor sentiment,” said Kim Jung-hoon, an analyst at Korea Investment & Securities Co. “There was also a bit of a technical rebound after the local stock market underwent a severe downfall due to the Libyan unrest.”

Earlier in the day, the government announced that Korea’s industrial output grew for the 19th straight month in January, indicating that Asia’s fourth-largest economy is continuing to expand.

Outlooks for future economic conditions also improved. The leading economic composite index, a gauge of economic performance eight to 15 months ahead of time, rose 0.2 percent, marking the first improvement in 13 months.

“It’s difficult to say that the market has swung upward, but the KOSPI may rise about 20-30 points next week,” said Kim.

Shares gathered ground across the board, led by automakers. Top automaker Hyundai Motor gained 2.79 percent to 184,000 won and its smaller affiliate Kia Motors soared 6.63 percent to 62,700 won.

Energy firms closed firmer amid rising oil prices. SK Innovation, the country’s top oil refiner, jumped 4.93 percent to 181,000 won.

Builders, which had suffered steep losses from the Libyan unrest, shifted to positive territory. Top builder Hyundai Construction & Engineering surged 6.58 percent to 76,100 won and smaller player GS Engineering & Construction gained 4.28 percent to 97,400 won.

Shares of telecommunications companies, however, ended bearish.

Leading mobile carrier SK Telecom edged down 0.62 percent to 160,500 won.

The local currency ended at 1,119.9 won to the greenback, up 8.3 won from Wednesday’s close, on the back of the KOSPI’s solid rise and growing views that Korea’s central bank will lift the key interest rate in a policy meeting on March 10, dealers said. 

(Yonhap News)
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