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South Korea: Shares rise as President seeks to raise China curbs at G-20
[SEOUL] South Korea's car and cosmetics stocks gained ground on Friday after the country's president told Reuters that he would address what is seen as Beijing's economic retaliation against South Korean businesses.
South Korean President Moon Jae In said in an interview with Reuters on Thursday that he hopes to hold talks with China's Xi Jinping at the G-20 summit in Hamburg, Germany, next month and ask for him to lift restraints on South Korean firms.
South Korea's decision to deploy a US anti-missile system to counter threats from North Korea has angered China, which says the system's powerful radar will look deep into its territory.
China has pressured South Korean businesses via boycotts and bans, such as ending Chinese group tours to South Korea, a blow to cosmetics firms and duty-free operators that relied on Chinese travellers' business.
"The Reuters report boosts hopes that the sanctions would be lifted. But it remains to be seen whether that will materialise," Yang Ji Hye, an analyst at Meritz Securities, said.
The rally came even as investors were bracing for sluggish earnings for cosmetics firms in the April to July quarter because of falling sales to Chinese consumers. "Today's rise could be temporary, but its lifting the mood," Park Jin Sol, a retail analyst at Taurus Securities in Seoul said.
As of 0122 GMT, South Korea's Kolmar Holdings is up 4.1 per cent, while Amorepacific Corp and Hankook Cosmetic are up 2.1 per cent and 2.2 per cent respectively. The Korea Composite Stock Price Index (Kospi) was up 0.2 per cent.
Hyundai Motor rose 1.9 per cent and Kia Motors was up 1.3 per cent on the news. Auto sales had also been hit by Chinese disapproval of South Korea's anti-missile deployment.