Seoul shares sharply rebound on dip-buying; Korean won gains ground

SEOUL, South Korean stocks rebounded sharply on Friday from a 19-month low the previous session amid growing concerns about a recession. The local currency rose against the U.S. dollar.

The Korea Composite Stock Price Index (KOSPI) spiked 52.28 points, or 2.26 percent, to close at 2,366.60.

Trading volume was moderate at 643.76 million shares worth 8.32 trillion won (US$6.41 billion), with gainers far outpacing decliners 875 to 44.

Institutions bought a net 640 billion won, while foreign and retail investors offloaded a net 35.4 billion won and 625 billion won worth of shares, respectively.

"The KOSPI has declined much more compared with overseas markets this year, but the Korean market is still attractive in terms of valuation given companies' firm fundamentals," Lee Jong-bin, an analyst with Meritz Securities Co., said. "But Friday's rally is a dead cat bounce."

Overnight, the U.S. stock market inched up on the second day of Federal Reserve Chair Jerome Powell's testimony before Congress, during which he reaffirmed the central bank's commitment to bringing down high-flying inflation.

The Fed raised its policy rate by 0.75 percentage point last week to tame inflation that is running at a 40-year high.

In Seoul, shares broadly went up, as institutional investors bought beaten-down tech stocks.

Market bellwether Samsung Electronics rose 1.74 percent to close at 58,400 won, and No. 2 chipmaker SK hynix added 1.55 percent to 91,600 won. Leading internet company Naver jumped 5.77 percent to 247,400 won.

Samsung Biologics, the biotech arm of South Korea's Samsung Group, went up 1.34 percent to 831,000 won, and top automaker Hyundai Motor gained 1.17 percent to 173,000 won.

Among losers, LG Chem, the country's leading chemical company, shed 1.45 percent to close at 543,000 won and battery maker SK Innovation also declined 0.5 percent to 198,000 won.

The local currency ended at 1,298.20 won against the U.S. dollar, up 3.6 won from the previous session's close at a 13-year low to the greenback.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys fell 8.5 basis points to 3.523 percent, and the return on the benchmark five-year government went down 10.3 basis points to 3.666 percent.

Source: Yonhap News Agency