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Kospi rebounds on Trump trade war remarks

Aug 28,2019
Korean stocks rebounded Tuesday, snapping a three-session losing streak, helped by comments from U.S. President Donald Trump that indicated a possible trade deal with China. The won appreciated against the dollar.

The benchmark Kospi rose 8.29 points, or 0.43 percent, to close at 1,924.60. Trade volume was moderate at 419 million shares worth 4.88 trillion won ($4.02 billion).

The local stock market opened higher in line with gains on Wall Street overnight, but pared earlier gains as investors remained cautious about the prospects for trade talks between Washington and Beijing.

Local stocks saw a sharp sell-off Monday as the world’s two largest economies exchanged threats of imposing more tariffs. But Trump said, following the Group of Seven summit of world leaders in France, Beijing is willing to resume trade talks with Washington.

Seo Sang-young, an analyst at Kiwoom Securities, said the comments by Trump had a positive impact on the local stock market as the “U.S.-China trade dispute showed signs of stabilization, rather than intensification.”

Individuals sold a net 31.3 billion won worth of shares, and foreign investors sold a net 184.8 billion won worth. Institutions bought a net 198.4 billion won of stocks.

Top cap Samsung Electronics rose 1.03 percent to end at 44,050 won and SK Hynix, a global chipmaker, gained 1.67 percent to 73,000 won. LG Electronics decreased 0.50 percent to 59,200 won.

Naver climbed 2.09 percent at 146,500 won.

Automakers traded mixed, with Hyundai Motor up 0.4 percent to 125,000 won, and Hyundai Mobis rising 0.63 percent to 240,500 won. On the other hand, its smaller affiliate Kia Motors dipped 0.71 percent at 41,800 won.

LG Chem dropped 0.15 percent to 323,000 won. Oil refiner SK Innovation went down 1.89 percent to 156,000 won. S-Oil shed 1.43 percent to 89,900 won.

The Kosdaq rose 5.41 points, or 0.93 percent, to end the session at 588.32.

The tech-heavy index was lifted by foreign buying of semiconductor and IT shares and a 1.3 percent rise in the Nasdaq Index overnight.

The won closed at 1,211.20 won against the dollar, down 6.6 won from the previous session’s close, also snapping a three-day run of decline, helped by increased risk-on sentiment.

Bond prices ended lower. The yield on three-year bonds rose 5.0 basis points to 1.17 percent. The yield on 10-year bonds rose 4.7 basis points to 1.24 percent.

BY KIM HE-YU, YONHAP [kim.heyu@joongang.co.kr]