Seoul shares end higher ahead of key U.S. inflation data

SEOUL– South Korean stocks ended higher Friday, snapping a five-day losing streak, as foreigners and institutions picked up oversold shares amid uncertainty over the U.S. Federal Reserve’s monetary policy direction. The Korean won sharply strengthened against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) rose 17.96 points, or 0.76 percent, to 2,389.04. The main index fell 2.6 percent this week through Thursday.

Trading volume was moderate at 309.52 million shares worth 7.09 trillion won (US$5.4 billion), with gainers outnumbering decliners 625 to 251.

A better-than-expected U.S. jobs report and service sector activity released earlier this week weighed on consumer sentiment amid concerns that the Fed may keep policy tightening to tame runaway inflation.

The possibility that the U.S. economy could slip into a recession in 2023 remains a major worry for the market.

“China’s reopening hopes and the dollar’s fall helped KOSPI rebound today and close in the positive territory,” Park Hee-cheol, an analyst at Mirae Asset Financial Group, said over the phone.

Investors are now looking to Friday’s (U.S. time) producer price index for November, one of the major pieces of data Fed officials will see before the Dec. 13-14 policy meeting, for clues on the path of interest rate hikes, analysts said.

Institutions and foreigners bought a combined 506 billion won worth of stocks, offsetting individuals’ stock purchases valued at 508 billion won.

Most large-cap stocks advanced, with market bellwether Samsung Electronics Co. rising 2 percent to 60,400 won, No.2 chipmaker SK hynix Inc. climbing 3.4 percent to 81,500 won and top carmaker Hyundai Motor Co. gaining 0.3 percent to 162,500 won.

Korea Electric Power Corp. jumped 8.5 percent to 21,000 won on expectations that electricity rates will go up after the National Assembly voted down a bill that would allow the state-run power supplier to issue more bonds to cover ballooning costs and losses.

Among decliners, the country’s sole aircraft manufacturer Korea Aerospace Industries Co. fell 0.5 percent to 45,900 won, leading car battery maker LG Energy Solution declined 3 percent to 515,000 won, and steelmaker POSCO Holdings shed 0.9 percent to 284,000 won.

The local currency ended at 1,301.30 won against the greenback, up 16.70 won from the previous day’s close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys fell 1.9 basis points to 3.657 percent, but the return on the benchmark five-year government bonds declined 4.8 basis points to 3.566 percent.

Source: Yonhap News Agency

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