Seoul shares likely to move in tight range next week
Published : 2014-01-18 10:48
Updated : 2014-01-18 10:48
The South Korean stock market is expected to move sideways next week due to investors' jitters over the fourth-quarter corporate earnings, analysts said Saturday.
The benchmark Korea Composite Stock Price Index (KOSPI) gained 0.9 percent from the previous week to close at 1,944.48 Friday.
Earlier this week, Seoul shares gathered ground as the weaker-than-expected U.S. jobs data curbed concerns that its central bank may speed up the tapering of its quantitative easing.
The U.S. added 74,000 jobs in December, hovering far below the market estimate of 197,000.
The Fed, which has operated an US$85 billion monthly bond-buying program in a bid to boost the U.S. economy by keeping interest rates low, announced last month that it would begin reducing bond purchases by $10 billion per month starting in January, citing signs of an economic recovery.
The local stock market also continued to gather ground on the back of the World Bank Group's prediction that the global economy will expand 3.2 percent on-year in 2014, improving from the 2.4 percent growth tallied last year.
The U.S. Federal Reserve's latest Beige Book released this week also lent support to the growth, which stated that the world's No. 1 economy is expanding at a "moderate" pace.
Weekly foreign selling came to a net 120 billion won ($113 million) while institutions scooped up a net 40 billion won and retail investors bought a net 72 billion won.
Analysts said the local stock market is forecast to remain flat next week due to a lack of leads, amid the release of listed firms' fourth-quarter earnings for fiscal 2013.
A handful of market giants are slated to announce their fourth-quarter performances next week, with top carmaker Hyundai Motor scheduled to release its data Thursday, followed by market behemoth Samsung Electronics on Friday.
Samsung Electronics, the world's No. 1 smartphone maker, said earlier this month it is expected to have posted an operating profit of 8.3 trillion won in the October-December period of last year, down 18.3 percent from the previous three-month period.
The estimate fell short of initial expectations, casting cloud over its future performance.
"Investors should also pay attention to Japan's monetary policy meeting slated to start Wednesday, which may also come up with an additional easing move," said Jennifer Lee, a researcher at KDB Daewoo Securities Co.
Tech firms and carmakers advanced 1.6 percent and 1.5 percent this week, respectively, with steelmakers also rising 2.4 percent. In contrast, builders and retailers shed 0.5 percent and 0.4 percent, respectively. (Yonhap News)