South Korean stocks closed 0.44 percent higher Friday, as five-year low jobless data in the United States cheered investor sentiment over an improving economy, analysts said. The local currency rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) advanced 8.57 points to 1,965.78. Trading volume was light at 306.8 million shares worth 4.13 trillion won (US$3.75 billion) with gainers outnumbering decliners 499 to 299.

"U.S. labor data give us a sense of where we are with the economy. U.S. jobless claims in March fell to the lowest since early 2008, making a positive impact on the stock market," said Cho Byung-hyun, an analyst at Tongyang Securities Co.

Cho said, however, the KOSPI's gains were capped by the key rate cut of the European Central Bank (ECB). Although the ECB lowered the rate by a quarter percentage point to 2.5 percent, it fell short of giving the market reassurance that it will lead to a firm economic recovery, he added.

Foreigners sold off a net 30.6 billion won, with retail investors unloading a net 91.1 billion won. Institutions bought a net 129.0 billion won.

Blue-chip exporters led the gains, with Samsung Electronics rising 0.46 percent to 1,535,000 won and Hyundai Motor jumping 2.28 percent to 202,000 won. Local zinc smelter Korea Zinc hiked 5.25 percent to 341,000 won on expectations for better quarterly results.

Some banking groups, in contrast, finished bearish on lackluster quarterly earnings. Shinhan Financial Group Co., South Korea's No. 4 banking group, inched down 0.4 percent to 37,050, with Hana Financial Group slumping 2.49 percent to 33,300 won.

The local currency ended at 1,097.10 won against the greenback, up 4.5 won from Thursday's close, largely due to the KOSPI's gains, dealers said.

Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasuries inched up 0.03 percentage point to 2.47 percent and the return on the benchmark five-year government bonds added 0.02 percentage point to 2.53 percent. (Yonhap news)