RTTNews - The South Korean stock market has finished higher now in three consecutive sessions, gaining nearly 70 points or 4 percent en route to a 13-month closing high. The KOSPI broke through resistance at the 1,610-point plateau, although now investors are anticipating a mild correction when the market opens for business on Tuesday.
The global forecast for the Asian markets provides little in the way of guidance as weakness among the financials and retail stocks is expected to be offset by gains among the oil and steel shares. The European markets finished on a positive note, while the U.S. markets ended little changed - and the Asian markets also are likely to trade in mixed fashion but may fall prey to profit taking following strong rallies on Monday.
The KOSPI finished sharply higher on Monday, thanks to solid gains among the financial stocks, technology shares and automobile producers.
For the day, the index gained 31.24 points or 1.98 percent to finish at 1,612.22 after trading between 1,602.34 and 1,614.05. Volume was 534.3 million shares worth 8.72 trillion won, with gainers beating decliners 441 to 375.
Among the gainers, Samsung Electronics climbed 3.4 percent, while Hyundai Motor added 4.4 percent, Samsung Securities climbed 5 percent, Daewoo Securities jumped 9.1 percent, Shinhan Financial Group rose 3.4 percent, KB Financial Group gained 2.8 percent and Hynix Semiconductor jumped 4.82 percent.
The lead from Wall Street is virtually flat with perhaps a touch of downside as stocks moved back to the downside over the course of the trading session on Monday, ending the day nearly unchanged after seeing some early strength. The major averages closed on opposite sides of the unchanged mark.
This morning, traders reacted to comments from a number of central bankers over the weekend at the Federal Reserve conference in Jackson Hole, Wyoming, indicating that interest rates are likely to remain fixed for some time despite some signs of economic stabilization. At the conference, Federal Reserve Chairman Ben Bernanke said, Economic activity appears to be leveling out, both in the United States and abroad. Bernanke also noted that the prospects for a return to growth in the near term appear good.
However, the optimism was partly offset by comments from economist Nouriel Roubini, who said that he sees a big risk of a double recession in an article for the Financial Times. Roubini, who predicted the magnitude of the recent financial crisis, stated that the global economy might bottom out in the second half of the year and that the economies in the U.S and other European countries might witness anemic or below trend growth for at least a couple of years.
The pullback by the markets was also partly due to comments from Sun Trust (SIT) CEO James Wells, who said that financial institutions are likely to incur further losses amid the dismal condition of the commercial real estate market.
In other news, conflicting reports have led to speculation over the health of Bernard Madoff, perpetrator of the largest Ponzi scheme in history, who may be dying of cancer at a federal prison in North Carolina. However, prison officials have refuted the cancer claim that a number of media outlets reported earlier.
The major averages saw choppy movement in late session dealing, resulting in a mixed close to kick off the week. While the Dow closed up by 3.32 points or less than a tenth of a percent at 9,509.28, the NASDAQ slipped by 2.92 points or 0.1 percent to 2,017.98 and the S&P 500 fell by 0.56 or 0.1 percent to 1,025.57.
In corporate news, MoneyGram International on Monday announced an agreement with South Korea's Shinhan Bank to offer MoneyGram money transfer services across the bank's network of 850 branch locations. MoneyGram noted that the agreement nearly doubles its agent network in South Korea. MoneyGram, with nearly 17,000 agent locations in the Asia Pacific region, has been providing services in South Korea since 2001 through agents Woori Bank and Kyongnam Bank.
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