South Korean stocks snapped a two-day losing streak to close higher Friday, after U.S. economic data pointing to solid consumer demand and easing inflation boosted hopes for an early end to the aggressive interest rate hikes.
The benchmark Korea Composite Stock Price Index (KOSPI) climbed 17.25 points, or 0.66 percent, to finish at 2,625.79. Trading volume was high at 658.6 million shares worth 12.3 trillion won (US$9.66 billion) with gainers outnumbering decliners 598 to 267.
"The Federal Reserve hinted at two possible additional rate hikes by the end of the year, but the market doesn't seem to buy that," Han Ji-young, an analyst at Kiwoom Securities Co. said.
"It won't be easy for the Fed to carry out two more (rate) hikes when we expect to see employment remain sluggish and prices projected to decline in June. Based on these, if bets for a July rate pause increase, stocks will get fresh upward momentum," Han said.
Wall Street rallied Thursday (U.S. time) as optimism grew that the Fed would loosen its grip on interest rate hikes after the latest economic data showed a stronger-than-expected economy and signs of inflation easing.
U.S. retail sales unexpectedly rose in May as purchases of vehicles and other goods increased. The most recent data on jobless claims climbed above the market forecast.
Air carriers and utilities gained ground. Flag carrier Korean Air Lines soared 4.75 percent to 24,250 won and the state-run electricity provider Korea Electric Power Corp. rose 1.35 percent to 18,830 won.
Tech behemoth Samsung Electronics erased earlier losses and closed up 0.42 percent to 71,800 won. Top battery maker LG Energy Solution gained 0.51 percent to 588,000 won.
Automaker Hyundai Motor shed 0.15 percent to 199,400 won and its smaller affiliate Kia slid 0.85 percent to 81,600 won.
Leading energy company SK Innovation fell 1.41 percent to 188,200 won.
The local currency ended at 1,271.90 won against the U.S. dollar, up 8.6 won from Thursday's close.
Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys slid 4.1 basis points to 3.585 percent and the return on the benchmark five-year government bonds fell 3.5 basis points to 3.601 percent.
Source: Yonhap News Agency