Seoul: Shares, won recover, boosted by China trade data

[SEOUL] South Korean investors bought beaten-down shares early on Wednesday, following gains on Wall Street and eurozone stocks showing signs of stability, and later in the session after better-than-expected China trade data.

China's efforts to stabilise its currency also helped improve recently damaged sentiment.

The Korea Composite Stock Price Index (KOSPI) advanced 1.4 per cent to 1,918.63 points as of 0252 GMT. Advancing issues outnumbered decliners by 4-to-1.

China's exports rose 2.3 per cent from a year earlier in December, while imports fell 4.0 per cent compared to a 8.7 per cent decline in November.

"This (pre-China data rise in stocks near mid-session) looks to me like a short-lived technical rebound," said Bae Sung-young, a stock analyst at Hyundai Securities.

The sub-index for construction shares jumped 8.1 per cent, leading gainers on the wider market.

Hyundai Engineering & Construction Co Ltd surged 10.2 per cent, while Daewoo Engineering & Construction Co Ltd climbed 7.4 per cent. GS Engineering & Construction Co Ltd jumped 12.3 per cent.

Foreign investors sold a net 17 billion Korean won (S$20.1 million) worth of KOSPI shares by midday.

The South Korean won firmed against the dollar, tracking the yuan as China's central bank took an aggressive approach to reversing the recent depreciation of the yuan.

The won was quoted at 1,206.6 on the dollar, up 0.3 per cent from Tuesday's close of 1,210.3.

"The won rose, at least temporarily, as the risk outlook brightened," said Jung Kyung-parl, a foreign-exchange analyst at Hana Futures.

March futures on three-year treasury bonds were quoted at 109.72, unchanged from the previous close.

REUTERS