You are here

Seoul: Stocks at over 2-week high, foreign buying helps; won eases

[SEOUL] South Korean shares rose to over two-week highs in a choppy early session on Monday, as weak manufacturing activity in China and grim domestic exports data were partially offset by foreign buying of equities.

The Korea Composite Stock Price Index (KOSPI) was up 0.3 per cent at 1,917.31 points as of 0240 GMT.

"Stocks were lifted after sentiment was badly hurt in January," said Kim Hyung-ryeol, a stock analyst at Kyobo Securities.

Activity in China's manufacturing sector contracted at its fastest pace in almost three-and-a-half years in January, missing market expectations.

In South Korea, exports posted an 18.5 per cent year-on-year drop to US$36.7 billion, down to levels last seen at the height of the global financial crisis in 2009.

Samsung Electronics Co Ltd shares were up 0.4 per cent, while steelmaker POSCO lost 2.2 per cent.

Hyundai Motor Co and Kia Motors Corp fell 1.5 per cent and 2.3 per cent, respectively.

Shares in Hyundai Merchant Marine Co Ltd rose 10.4 per cent after the company said its plans to seek a new buyer for its majority stake in stock brokerage Hyundai Securities Co Ltd.

Foreign investors were poised to be net buyers, purchasing a net 59 billion won (S$69.78) worth of shares by midday.

The South Korean won fell against a broadly stronger dollar in the wake of Bank of Japan's decision on Friday to adopt a negative interest rate as part of its massive stimulus efforts.

The won was quoted at 1,204.6 against the dollar, down 0.5 per cent from its previous close.

"Japan's central bank's move to cut a benchmark rate below zero to stimulate its economy could mean a higher chance for us to see a weaker won," said Park Yuna, a foreign-exchange analyst at Dongbu Securities.

Mr Park said that China's yuan is still weak despite the People's Bank of China's recent efforts to stabilise its currency.