South Korea: Stocks higher on bullish central bank outlook

[SEOUL] South Korean shares rose early on Friday as a bullish economic outlook from the central bank bolstered investor sentiment, while market heavyweight tech firms recovered earlier losses.

The Bank of Korea kept policy unchanged on Thursday but upgraded its growth outlook to 3 per cent, boosting expectations for an interest rate hike in coming months.

The Korea Composite Stock Price Index (Kospi) was up 0.4 per cent at 2,483.22 points as of 0254 GMT.

"Investors are now taking the BOK's bullish stance into account as the markets did not price it in that much yesterday due to a heavy sell-off in major IT companies on profit-taking,"said Kim Ji-hyung, a stock analyst at Hanyang Securities.

Major tech firms like Samsung Electronics and SK Hynix gained nearly 2 per cent and 3.5 per cent, respectively.

Foreign investors purchased a net 57.3 billion won (S$68.8 million) worth of Kospi shares near mid-session, supporting the benchmark index.

A surprise announcement from a government-organised committee recommending the resumption of nuclear reactor construction pushed utilities shares higher.

Shares of Korea Electric Power Corp (Kepco) jumped 5.6 pe rcent, while Kepco Engineering & Construction and Kepco Plant Service & Engineering surged as much as 20 per cent and 10 per cent, respectively.

The South Korean won was flat at 1,132.9 to the dollar compared with Thursday's close of 1,132.4.

December futures on three-year treasury bonds continued to fall on traders' views that a central bank rate hike could come sooner than expected. The futures shed 0.24 of a point to 108.03 after falling 0.23 of a point on Thursday.

REUTERS