04.23 Tue


Tepid trading as firms release mixed Q2 reports

July 28,2018
Korean stocks closed higher on Friday after a choppy trading session that had foreigners turning to buy in response to a flurry of quarterly earnings reports from major companies. The Korean won closed at 1,118.1 against the U.S. dollar, up 1.2 won from Thursday.

The benchmark Kospi rose 5.93 points, or 0.26 percent, to close at 2,294.99. Trade volume was light at 259.1 million shares worth 5.03 trillion won ($4.49 billion), with winners beating losers 536 to 278.

The agreement between U.S. President Donald Trump and a European delegation on lowering trade barriers sparked fresh optimism in the stock market, but it also raised concerns that Washington may be more focused on a trade spat with China.

U.S. Treasury Secretary Steven Mnuchin said on Thursday that the administration was closely monitoring the Chinese renminbi and other currencies for signs of manipulation.

Foreigners bought a net 163.4 billion won worth of local stocks, while institutional and retail investors offloaded a net 79.9 billion won and 83.6 billion won to limit the gains.

Tech shares were mixed. SK Hynix rose a solid 3.61 percent to 86,100 won. Samsung Electronics remained unchanged at 46,900 won. LG Electronics tumbled 7.09 percent to 76,000 won after posting sluggish second-quarter earnings on its slumping mobile business.

Auto shares, too, moved in different directions. Industry leader Hyundai Motor retreated 0.38 percent to 129,500 won. Affiliate Kia Motors edged up 0.31 percent to 31,950 won, though it posted weak second-quarter earnings based on a strong won and increased incentives to cut inventories. Parts supplier Hyundai Mobis jumped 2.24 percent to 228,000 won.

The state-owned Korea Electric Power Corporation dropped 1.22 percent to 32,500 won as analysts expected rising raw material costs to erode its profit. Lotte Data Communication closed at 29,000 won in its first trading session, coming below its initial public offering price of 29,800 won. The IT solutions unit of Lotte Group, one of the country’s largest conglomerates, went public the same day with the aim of expanding abroad.

The secondary Kosdaq rose 8.83 points, or 1.15 percent from the previous trading day, to 773.98. Institutional and foreign investors diving into semiconductor shares contributed to the uplift.

Bond prices, which move inversely to yields, ended lower. The return on three-year government bonds added four basis points to close at 2.11 percent, and the return on 10-year bonds gained two basis points to end at 2.57 percent.

BY SONG KYOUNG-SON, YONHAP [song.kyoungson@joongang.co.kr]
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