Seoul: Stocks extend gains for fourth week as inflation fears ease

[SEOUL] South Korean shares closed higher on Friday, tracking overnight gains in Wall Street as inflationary concerns eased ahead of the US Federal Reserve policy meeting next week. The won strengthened, while the benchmark bond yield rose.

The Kospi closed up 24.68 points or 0.77 per cent at 3,249.32.

The benchmark index ended the week up 0.29 per cent, extending the buying spree to a fourth straight week.

Among the heavyweights, technology giant Samsung Electronics ended flat, while peer SK Hynix rose 4.07 per cent. Battery maker LG Chem added 5.33 per cent.

Foreigners were net buyers of 176.5 billion won (S$209.9 million) worth of shares on the main board.

The Bank of Korea will start normalising its loose monetary policy in an orderly manner once the economy is seen on track for a solid recovery, the central bank's governor said.

"(US) CPI hovered much above market expectations, though it was largely viewed as temporary," said Seo Sang-young, an analyst at Mirae Asset Securities.

Investors now await the Federal Reserve two-day policy meeting due to be held next week.

The won ended at 1,110.8 per dollar on the onshore settlement platform, 0.45 per cent higher than its previous close at 1,115.8.

It rose 0.51 per cent on a weekly basis, bouncing back from a 0.09 per cent decline a week earlier.

In offshore trading, the won was quoted at 1,110.9 per dollar, up 0.1 per cent from the previous day, while in non-deliverable forward trading its one-month contract was quoted at 1,110.4.

In money and debt markets, June futures on three-year treasury bonds fell 0.12 point to 110.78.

The most liquid three-year Korean treasury bond yield rose by 1.3 basis points to 1.295 per cent, while the benchmark 10-year yield rose by 2.5 basis points to 2.110 per cent.

REUTERS