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Kospi has a good day as trade tensions ease

Aug 02,2018
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Korean stocks closed higher Wednesday as investor sentiment was boosted by positive export data and reports of U.S.-China negotiations to settle the latest trade dispute. The Korean won depreciated against the U.S. dollar.

The benchmark Kospi rose 11.81 points, or 0.51 percent, to close at 2,307.07. Trade volume was light at 4.7 trillion won ($4.19 billion).

Analysts said the main index closed higher amid rising hopes that the world’s two largest economies resolve their dispute over tariffs.

“Considering the Korean market has been losing ground due to concerns over the trade dispute, the reports that the U.S. and China are seeking a negotiation lends a hand to the local market,” said Seo Sang-young, an analyst at Kiwoom Securities.

Positive export data for July, which recorded a 6.2 percent on-year growth, also gave a boost to stocks when data was released on Wednesday.

Foreigners purchased a net 174 million won. Institutional investors sold more shares than they bought at 141 million won and retail investors also offloaded a net 66 million won.

Shares of low-cost carrier T’way Air, which made its first appearance on the Kospi Wednesday, closed 0.43 percent lower at 11,550 won from its initial price.

Pharmaceutical firms closed mostly higher, with Celltrion rising 3.31 percent to 280,500 won following news that the company won a lawsuit over a patent dispute against bio firm Janssen, a subsidiary of U.S. medical conglomerate Johnson & Johnson. Samsung BioLogics advanced 2.68 percent to 383,000 won.

Tech giants also mostly closed higher, with Samsung Electronics moving up 0.65 percent to 46,550 won and LG Electronics increasing 0.67 percent to 75,300 won. No. 2 chipmaker SK Hynix lost 0.81 percent to 85,600 won.

The secondary Kosdaq rose 14.73 points, or 1.90 percent, to 790.25, buoyed by a 2.0 percent incline in the U.S. Nasdaq biotech index and institutional and foreign buying of pharmaceutical shares.

Pharmaceutical shares rose 3.1 percent across sector. Celltrion Healthcare rose 2.96 percent to 94,000 won and Celltrion Pharm climbed 7.67 percent to 75,800 won. SillaJen jumped 11.69 percent to 58,300 won.

The Korean won closed at 1,120.60 won against the U.S. dollar, up 1.90 won from Tuesday’s close.

Bond prices, which move inversely to yields, ended lower. The yield on three-year bonds added 0.1 basis point to 2.12 percent, and the return on 10-year bonds climbed 2.2 basis points to 2.59 percent.


BY KIM EUN-JIN, YONHAP [kim.eunjin1@joongang.co.kr]