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Seoul shares gain 0.45 pct ahead of FOMC results

Seoul shares gain 0.45 pct ahead of FOMC results

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Published : 2013-12-18 15:46
Updated : 2013-12-18 15:46

South Korean stocks closed 0.45 percent higher Wednesday, as investors chose to embrace the uncertainties on a U.S. stimulus cut and increased bets on local shares, analysts said. The local currency fell marginally against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) rose 8.89 points to finish at 1,974.63. Trading volume was light at 253.9 million shares worth 3.76 trillion won ($3.57 billion) with decliners outpacing gainers 402 to 389.  

Analysts in Seoul said Wednesday's gain, though marginal, can be seen as a sign that investors are accepting the inevitability of the Fed's tapering and are turning to see the "bright side" of it.

"Whether (the tapering) comes tomorrow after the Fed meeting or in March, one thing is for sure... that reducing the stimulus does not mean a monetary tightening, but a sign that the U.S. economy is on a recovery path," said Suh Dae-il, an analyst at KDB Daewoo Securities Co. 

The two-day Federal Open Market Committee (FOMC) is expected to release a statement on Thursday (Seoul time), which investors hope will give some definite answers as to when the tapering of the $85 billion-a-month bond purchases will start.

The KOSPI's gain was shored up by a firm institutional buying worth 287.5 billion won, which also reflects investors' confidence over market fundamentals, analysts added.

Foreigners, in contrast, dumped a net 147.1 billion won, but analysts regarded it as a one-off factor.

Shares gathered ground across the board, with financial firms and telecom companies leading the climb. Shinhan Financial Group, the biggest banking firm by market cap, advanced 2.71 percent to 45,500 won and LG Uplus, the smallest mobile carrier, rose 2.96 percent to 10,450 won.

Top-listed stocks also finished bullish. Samsung Electronics gained 0.43 percent to 1,401,000 won, with Hyundai Motor rising 0.22 percent to 227,500 won. 

The local currency ended at 1,051.30 won against the greenback, down 0.2 won from Tuesday's close, as foreigners reduced their holdings in local equities, dealers said. (Yonhap News)

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