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Q4 hype spurs buying spree in local market

Dec 23,2017
Seoul’s main bourse rose for the first time in five sessions on Friday, pushed up by foreign and institutional investor purchases due to positive fourth-quarter earnings outlooks.

The benchmark Kospi index closed at 2,440.54, up 10.71 points, from the previous session, snapping a four-day decline.

“The market has likely entered a year-end rally as investors have turned their eyes to fourth-quarter earnings reports,” said Kim Yong-ku, an analyst at Hana Financial Investment. “But investors are still worried that while fourth-quarter earnings might improve from a year ago, they may slightly fail to meet the market consensus on an on-quarter basis.”

Institutional and foreign investors were the main buyers of Korean stocks, each scooping up 388.4 billion won ($361.2 million) and 136.2 billion won. Retail investors sold off 527.0 billion won in shares.

By sector, pharmaceuticals rose 1.2 percent, while food and beverages and banking each rose 1 percent.

Samsung Electronics, the largest company by market capitalization, rose 1.14 percent to 2,485.000 won. Naver, operator of the country’s most popular search engine, increased 2.38 percent to close at 862,000 won.

Auto companies were in positive terrain. Hyundai Motor, the top automaker, advanced 2 percent to end the day at 153,000 won. Its affiliate Kia Motors inched up 0.61 percent to 33,100 won, and auto parts supplier Hyundai Mobis grew 0.39 percent to 260,000 won.

Battery producers also moved up. LG Chem, the largest battery maker, rose 0.64 percent to close at 393,500 won. SK Innovation jumped 0.74 percent to 204,000 won, and Samsung SDI closed at 197,500 won, up 0.51 percent from the previous session.

Financial companies showed mixed movement. KB Financial Group, the largest financial holding company in Korea by assets, climbed 0.65 percent to 62,300 won. Shinhan Financial Group remained fixed at 50,700 won, while Hana Financial Group fell 0.98 percent to 50,300 won.

Top cosmetic companies were in negative terrain. LG Household and Health Care retreated 0.76 percent to 1,178,000 won, while AmorePacific fell 0.50 percent to 299,000 won.

The Kosdaq also bounced back from a four-day decline, rising 20.88 points to 761.20 on Friday.

The local currency closed at 1,079.7 won against the U.S. dollar, up 3 won from the previous session amid worldwide weakening of the U.S. dollar.

Returns on three-year government bonds climbed four basis points to 2.13 percent. Yields on 10-year bonds rose one basis point to 2.5 percent.

BY CHOI HYUNG-JO, YONHAP [choi.hyungjo@joongang.co.kr]