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Kospi rises close to 2,000 points on coronavirus vaccine news

Currency dealers work in the dealing room of Hana Bank in Seoul on May 21, 2020. The benchmark Kospi added 8.67 points, or 0.44 percent, to close at 1,998.31. (Yonhap)
Currency dealers work in the dealing room of Hana Bank in Seoul on May 21, 2020. The benchmark Kospi added 8.67 points, or 0.44 percent, to close at 1,998.31. (Yonhap)

South Korean stocks opened higher Thursday on encouraging news about another COVID-19 candidate vaccine in the US.

Extending gains for the fifth consecutive day, the nation’s main bourse Kospi crossed the 2,000-point mark in early morning trading for the first time since March 6 as it rose 13.65 points, or 0.68 percent, to 2,003.20. It closed at 1998.31, up 0.44 percent.

Retail investors drove the index as they bought stocks worth some 204.9 billion won ($166.5 million) while institutional investors purchased around 16.6 billion won at around 10 a.m.

“The local stock market has made gains as US companies in the tech sector are actively countering the ongoing coronavirus crisis by beefing up their online capabilities, and chip-related companies are showing some improvement in their business activities,” said Seo Sang-young, an analyst from local brokerage Kiwoom Securities.

Kakao and Naver, two of the largest online platform operators in Korea, saw their stock prices hit a record high. Kakao shares reached 240,000 won in the morning while Naver’s stock was traded at 233,500 won.

Shares in the electronic component, energy, and gaming segments were among the main drivers of the market’s gains.

Chemical giant LG Chem rose to a high of 385,000 won, up 6.21 percent, while game developer NCSoft saw its stock rise to a high of 794,000 won, up 5.87 percent.

Following a positive interim testing result of a vaccine being developed by US pharmaceutical firm Moderna on Monday, Biotech Inovio announced on Wednesday its preclinical testing of an experimental coronavirus vaccine showed “robust neutralizing antibody and T cell immune responses,” against the new strain of coronavirus. Its stock price grew 8.45 percent to $15.79 on the day after the announcement.

Buoyed by the news on positive testing results, all three major indexes in the US -- the Dow Jones Industrial Average, Nasdaq, and S&P 500 -- closed higher Wednesday. The Dow Jones rose 1.52 percent while Nasdaq and S&P 500 gained 2.08 percent and 1.67 percent, respectively.

US West Texas Intermediate crude futures for July soared $1.53, or 4.8 percent, to settle at $33.49 per barrel while Brent crude futures increased 3.2 percent to $35.75 per barrel.

The rise of oil prices is being attributed to the easing of economic lockdowns in the US and other countries. The Energy Information Administration reported Wednesday that US crude oil inventories dropped by 5 million barrels for the week ended May 15, which is the second weekly decline in a row.

By Kim Young-won  (wone0102@heraldcorp.com)
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