Published : 2013-02-13 16:19
Updated : 2013-02-13 16:19
South Korean stocks closed 1.56 percent higher on Wednesday as concern over a global currency row eased following a warning from major advanced economies against Japan's aggressive monetary easing, analysts said. The Korean won gathered ground against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) soared 30.28 points to finish at a three-week high of 1,976.07. Trading volume was moderate at 324.9 million shares worth 3.62 trillion won (US$3.33 billion) with gainers far outnumbering decliners 597 to 230.
"The warning from the Group of Seven on Japan's monetary easing alleviated concerns on the currency row, prompting a hike in local auto shares," said Kwak Joong-bo, an analyst at a Samsung Securities Co.
The G7 on Tuesday vowed to let the market determine the value of their currencies, blaming Tokyo for its aggressive monetary easing policy.
Kwak expected more similar remarks to come along at the Group of 20 finance ministers meeting slated for later this week, which is expected to further ease the yen's fast descent.
Auto stocks soared, with industry leader Hyundai Motor gaining 2.36 percent to 216,500 won and its smaller affiliate Kia Motors jumping 3.85 percent to 53,900 won.
Net stock purchases by foreigners and institutions drove up the KOSPI. Overseas investors snapped up a net 112.8 billion won, extending its buying binge for the fourth consecutive session.
Institutions scooped up a net 243.1 billion won, the largest net purchase since Jan. 28.
Brokerage houses and steelmakers finished bullish on hopes of an economic recovery following U.S. President Barack Obama's State of the Union speech, in which he firmly reiterated the drive toward salvaging the world's largest economy from deficits.
Major local brokerage firm Mirae Asset Securities spiked 5.41 percent to 38,950 won and zinc smelter Korea Zinc hiked 5.61 percent to 395,500 won.
In contrast, telecom shares were bearish, with top mobile carrier SK Telecom falling 1.39 percent to 177,000 won.
The local currency ended at 1,086.80 won against the greenback, up 4.0 won from Tuesday's close, as investors stayed wary over any abrupt sanction measure from the U.N. on North Korea's nuke test, dealers said.
Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasuries rose 0.02 percentage point to 2.73 percent and the return on the benchmark five-year government bonds gained 0.03 percentage point to 2.86 percent. (Yonhap News)