SEOUL: South Korean stocks snapped a six-day losing streak to end nearly 1 percent higher on Tuesday, with the local currency also gaining ground versus the U.S. dollar, as the two Koreas reached a dramatic deal to end tensions on the peninsula, analysts said.
After starting lower at the opening bell, the benchmark Korea Composite Stock Price Index (KOSPI) closed up 16.82 points, or 0.92 percent to 1,846.63. Trading volume was moderate at 444.8 million shares worth 6.6 trillion won (US$5.4 billion) with advancers far outpacing decliners 691 to 145.
The KOSPI dipped to a two-year low on Monday, reeling from China’s stock market rout and a dip in Wall Street.
“Having eased the North Korean risk worked as one positive factor for the local market,” said Bae Sung-young, an analyst at Hyundai Securities Co.
Earlier in the day, North and South Korea reached an agreement on defusing heightened tensions in a dramatic breakthrough after days of intensive high-level talks.
The North expressed regret over its landmine attack, which led to an exchange of artillery shelling between the two sides last week, and promised to make efforts toward ending provocations.
But the Tuesday gains are part of a technical rebound as a result of bargain hunting after days of losses, Bae noted, adding that the Seoul market is still prone to further face volatility for the time being.
