Seoul: Stocks jump most in 3 weeks on chip boost, finance minister remarks

[SEOUL] South Korean shares posted their biggest jump in nearly 3 weeks on Tuesday (Nov 2), as chip heavyweights took clues from a record overnight Wall Street bounce, while investors cheered the government's plan to seek inclusion into MSCI's developed markets index.

The Korean won edged up, while the benchmark bond yield fell ahead of several key central bank meetings.

Focus is now on the US Federal Reserve and the Bank of England that will hold their policy decisions later in the week, after the Reserve Bank of Australia kept its rate unchanged, while abandoning its ultra-low target for bond yields.

The benchmark Kospi closed up 34.55 points or 1.16 per cent at 3,013.49, marking its sharpest daily gain since Oct 14. It ended 0.28 per cent higher on Monday (Nov 1).

South Korea's finance minister said the government will seek the country's inclusion into MSCI's developed markets index and that it will consult with the global index provider, a ministry statement showed.

Separately, the finance ministry said it would buy back 2 trillion won (S$2.3 billion) of treasury bonds as part of emergency measures to stabilise local bond markets.

Chip giants Samsung Electronics and SK Hynix rose 2.29 per cent and 0.94 per cent, respectively, while platform company Kakao added 1.99 per cent.

Foreigners were net buyers of 317.3 billion won worth of shares on the main board.

The country's consumer inflation had accelerated to a near 10-year peak in October, reinforcing the case for another interest rate hike this year.

The won ended at 1,174.4 per dollar on the onshore settlement platform, 0.18 per cent higher than its previous close.

In offshore trading, the won was quoted at 1,174.5, while in non-deliverable forward trading its 1-month contract was quoted at 1,175.3.

In money and debt markets, December futures on 3-year treasury bonds rose 0.32 point to 108.15.

The benchmark 10-year yield fell by 3.5 basis points to 2.463 per cent.

REUTERS