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Kospi follows U.S. market up after midterms

Nov 09,2018
Korean stocks ended higher Thursday as U.S. midterm elections’s conclusion cleared up market uncertainties, while the subsequent rallies in U.S. stock markets supported investor sentiment. The Korean won appreciated against the U.S. dollar.

The benchmark Kospi rose 13.94 points, or 0.67 percent, to close at 2,092.63. Trading volume was moderate at 322.59 million shares worth 5.86 trillion won ($5.25 billion).

“The outcome of the midterm elections was what the market had largely expected, which removed uncertainties that had weighed down the market,” said Kim Yoo-kyeom, an analyst at Cape Investment & Securities.

“Ahead of the U.S. central bank’s decision on the policy rate and with concerns over China’s economic slowdown, the market is expected to have high volatility for the time being,” he added.

Foreign investors picked up a net 492.7 billion won of local shares to pull the index up, while retail investors sold a net 275.5 billion won and institutional investors offloaded a net 230.4 billion won worth of stocks.

Tech shares were winners in the session as market bellwether Samsung Electronics edged up 0.11 percent to 44,050 won, and chipmaker SK Hynix rose 2.97 percent to 72,900 won.

Financial shares also ended the session up, with Shinhan Financial Group adding 0.35 percent to 42,850 won and KB Financial Group advancing 0.94 percent to 48,450 won.

Carmakers closed the session lower as Hyundai Motor declined 1.86 percent to 105,500 won, and its sister company Kia Motor inched down 0.18 percent to 28,500 won.

Pharmaceutical shares ended mixed. While Celltrion increased 2.14 percent to 238,500 won, Samsung BioLogics skidded 3.87 percent to 384,500 won in light of revelations of an internal company document by a lawmaker that the company had intentionally committed accounting fraud during the merger deal between Samsung C&T and Cheil Industries in 2015.

The Kosdaq also rose, adding 11.30 points, or 1.66 percent, to close at 693.67. The tech and bio-heavy index was helped by a 2.64 percent rise in the U.S. Nasdaq Composite Index overnight and foreign investor buying.

The Korean won closed at 1,117.30 won against the U.S. dollar, down 6.0 won from Wednesday’s close.

Bond prices, which move inversely to yields, ended mixed. The yield on three-year bonds was up 0.2 basis point to 1.97 percent, and the return on 10-year bonds fell 0.2 basis point to 2.26 percent.

BY CHAE YUN-HWAN, YONHAP [chae.yunhwan@joongang.co.kr]