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Won and markets recover from four-day slide

June 30,2018
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The Korean stock market bounced back from four days of losses thanks to investors taking interest in second quarter earnings, though concerns over a trade dispute between the United States and China have yet to ease. The Korean won appreciated after four days of seeing its value fall against the U.S. greenback.

The benchmark Kospi closed higher by 11.89 points, or 0.51 percent, compared to Wednesday to end the week at 2,326.13.

However, the main bourse worried investors earlier in the day, as it fell below the 2,300 mark for the first time since May 22, falling as low as 2,296.39 before recovering in the afternoon.

“In the morning, worries over a possible trade war between the United States and China weighed heavily on the market,” said Suh Sang-young from Kiwoom Securities. “But the stock market had a modest recovery, as there were some signs of optimism between Washington and Beijing.”

Chinese media reported that the two sides are seeking ways to compromise before U.S. tariffs on Chinese imports are set to take effect on July 6. Earlier on Thursday, the Chinese government announced plans to ease its foreign investment curbs on sectors such as banking, automobiles, heavy industry and agriculture.

While most blue chips rose, market bellwether Samsung Electronics dipped 0.32 percent to close at 46,650 won.

Although it didn’t fall as sharply as on Thursday, the country’s largest company by market capitalization fell for the second consecutive trading day over concerns over weakening smartphone sales and falling NAND flash prices. SK Hynix saw a 2.63 percent increase to close at 85,700 won and LG Electronics rose 2.6 percent to 83,000 won. Celltrion, the third-largest company by market capitalization, saw a 1.85 percent increase to close at 303,500 won, while Hyundai Motor bumped up by 0.4 percent.

Builders finished bullish on an inter-Korean agreement on road connection projects. Hyundai Construction & Engineering jumped 5.12 percent to 57,500 won and Daewoo Construction & Engineering rose 2.62 percent to 5,870 won.

The tech-heavy Kosdaq also turned around for the first time in four days, adding 8.02 points, or 0.99 percent.

The Korean currency closed at 1,114.5 won against the U.S. dollar, up 9.7 won from the previous day’s close. This was the biggest one-day surge since March 27.

Bond prices, which move inversely to yields, ended mixed. The yield on three-year Treasuries grew by 0.7 basis points to 2.122 percent, and the return on five-year government bonds fell 0.2 basis points to 2.352 percent.


BY LEE HO-JEONG, YONHAP [lee.hojeong@joongang.co.kr]