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Optimism over summit buoys Seoul stocks

May 11,2018
Seoul’s main bourse closed slightly higher on Thursday, riding on improved investor sentiment on the upcoming summit between the United States and North Korea.

The benchmark Kospi rose 20.18 points, or 0.83 percent, from the previous trading session to close at 2,464.16 on Thursday, snapping its fall that extended for the past five days.

“North Korea turned to take a more positive attitude toward the summit after U.S. Secretary of State Mike Pompeo’s Pyongyang visit,” said Cho Byung-hyun of Yuanta Securities Korea. “The news fanned expectations for denuclearization talks and worked as a momentum for shares of industrial parts and construction.”

Institutional investors were the main buyers of the local stocks, scooping up 81.2 billion won ($75.8 million) worth of Korean shares.

Foreigners net sold 40.5 billion won in stocks while retail investors offloaded 73.1 billion won on Thursday.

By sector, mechanical shares rose 2.9 percent and steel and metal shares increases 2.8 percent. Electrical and electronics shares pushed up 1.4 percent.

Large-cap shares were overall in positive terrain.

Market heavyweight Samsung Electronics stepped up 1.38 percent to close the day at 51,600 won. Second-leading chip producer SK Hynix rose by 2.88 percent to 85,800 won.

Posco, the country’s top steelmaker, advanced 2.57 percent to 359,500 won.

Auto shares were in negative terrain.

Top automotive company Hyundai Motor retreated 0.98 percent to 152,000 won. Its affiliate and parts maker Hyundai Mobis also fell 1.49 percent to 231,500 won. Kia Motors inched down 0.30 percent to 33,450 won.

KB Financial Group, Korea’s top financial holding company by assets, edged down 0.34 percent to 58,000 won.

Top pharmaceutical company Celltrion remained unchanged at 259,000 won.

The secondary Kosdaq continued its rally into the second trading day, up 4.08 points, or 0.48 percent, to close the session at 854.93.

The local currency closed at 1,073.1 won against the U.S. dollar, up 7.8 won from the previous session’s close, the highest daily value since April 30, when the won-dollar rate finished at 1,068 won.

Bond prices closed higher. The yield on three-year bonds fell 3.3 basis points to 2.276 percent, and the return on benchmark five-year government bonds also decreased 3.3 basis points to 2.550 percent.

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