Seoul: Shares end higher on Fed policy support hopes, chip shares

[SEOUL] South Korean shares closed higher on Wednesday, as hopes of continued policy support from the Federal Reserve to the US economy lifted sentiment, with stocks of local chipmakers leading the gains. The won and the benchmark bond yield rose.

The benchmark Kospi ended 22.34 points or 0.71 per cent higher at 3,148.29.

Foreigners were net buyers of 193.8 billion won (S$233.92 million) worth of shares on the main board.

The US economy could see a strong rebound in the second half of this year as vaccinations become widely available, but the virus is still driving the economy and monetary policy will remain accommodative, Boston Federal Reserve Bank president Eric Rosengren said.

The Treasury yield curve has been steepening seems to be short-lived, which erased some fears about interest-rate hikes, DS Investment & Securities' analyst Na Jeong-hwan said.

SK Hynix jumped 3.1 per cent, while Samsung Electro-Mechanics surged 5.44 per cent on hopes of increasing demand for the firm's components in electric cars and other devices.

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The won was quoted at 1,095.1 per dollar on the onshore settlement platform, up 0.44 per cent.

In offshore trading, the won was quoted at 1,095.5 per dollar, down 0.1 per cent, while in non-deliverable forward trading its one-month contract was quoted at 1,094.5.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.25 per cent.

The Kospi has risen 9.56 per cent so far this year, and gained 19 per cent in the previous 30 trading sessions.

The trading volume was 1,555.04 million shares. Of the total traded issues of 905, the number of advancing shares was 626.

The most liquid three-year Korean treasury bond yield rose by 0.3 basis point to 0.979 per cent, while the benchmark 10-year yield rose by 0.1 basis point to 1.719 per cent.

REUTERS