SEOUL: South Korean shares bounced back to six-year highs on Tuesday as April exports rose at a much faster-than-expected pace, boosting investment sentiment. Gains were also supported by optimism that the economy could pick up steam after the presidential election on May 9.
The Korea Composite Stock Price Index (KOSPI) rose 0.9 per cent to 2,226.18 points as of 0216 GMT. It touched a high of 2,229.74, the strongest level since April 27, 2011. “Market participants seem to believe April’s robust exports are a sign for another strong quarter in the April-June period,”said Kim Ji-hyung, a stock analyst at Hanyang Securities. Mr Kim added that though there might be some profit-taking in coming days, the KOSPI is likely to climb higher on foreign buying.
Foreign investors were set to be strong net buyers, purchasing 135.6 billion Korean won (S$167 million) worth of KOSPI shares near mid-session. Tech giant Samsung Electronics looked set to exend its winning streak to a seventh straight session, rising nearly 1 per cent. Shares of securities companies also gained. Samsung Securities rose nearly 3 per cent and Shinyoung Securities 1 per cent. Advancers outnumbered decliners 403 to 371.
The South Korean won also strengthened on demand for local equities, while comments by US President Donald Trump were seen as easing ongoing tensions between the United States and North Korea. Mr Trump on Monday opened the door to meeting North Korea’s Kim Jong Un, saying he would be honored to meet the young leader under the right circumstances. The won was quoted at 1,130.6 against the dollar, up 0.6 per cent compares to the previous close of 1,137.9. June futures on three-year treasury bonds shed 0.06 point to 109.38.
