The South Korean stock market has finished higher now in three consecutive sessions, gathering nearly 80 points or 7 percent in the process. The KOSPI broke through support at 1,275 points, and now analysts are expecting more modest gains in Friday's trade - although the market could challenge the 1,300-point plateau.
The global forecast for the Asian markets continues to be strong, although some profit taking may set in as several bourses already have seen major gains this week. The G-20 economic summit in London has generated considerable positive momentum, fueling optimism that the global economy may finally be starting to recover. The European markets finished sharply higher, as did the U.S. markets - and the Asian bourses are predicted to follow suit.
The KOSPI finished sharply higher again on Thursday, boosted again by the financial stocks and the construction issues. Automobile shares also ended in positive territory again, as did the technology issues.
For the day, the index jumped 43.61 points or 3.54 percent to close at 1276.97 after trading between 1,249.94 and 1,278.56. Volume was 720 million shares worth 7.8 trillion won, while gainers led decliners at 699 to 138, with 39 stocks ending unchanged.
The financials led the market to the upside as Woori Finance gained 7.72 percent, while Shinhan Financial Group jumped 7.77 percent, KB Financial Group climbed 6.82 percent and Samsung Securities rose 3.6 percent.
Among other gainers, Hyundai Engineering & Construction climbed 7 percent, while GS Engineering & Construction surged 10.8 percent, Samsung Electronics ended 3.63 percent higher, Hynix Semiconductor was up 3.67 percent, Hyundai Motor rose 4.48 percent, Kia Motors rose 3.02 percent, Ssangyong Motor rose 4.00 percent, Hyundai Heavy Industries gained 5.22 percent, Samsung Heavy Industries advanced 3.82 percent, Daewoo Shipping added 5.63 percent, LG Electronics advanced 3.89 percent and LG Display gained 5.04 percent.
The lead from Wall Street remains upbeat as stocks showed a strong upward move during trading on Thursday, as investors reacted well to mixed economic news and liked what they heard from the G-20 summit in London. The continued advance also reflected some optimism about stabilization in the economy.
Before the start of trading, the Labor Department said that initial jobless claims in the week ended March 28th unexpectedly rose to 669,000 from the previous week's revised figure of 657,000. With the increase, jobless claims rose to a new twenty-six year high.
Additionally, a report from the Commerce Department showing that factory orders rose 1.8 percent in February added to recent signs of stabilization in the economy, although the report also showed a notable downward revision to the data for January.
Meanwhile, traders were also keeping a close on the Group of 20 Summit in London, with the world leaders assembled at the meeting pledging to do whatever is necessary to end the economic crisis. President Barack Obama called the agreements reached by leaders a turning point in our pursuit of global economic recovery.
However, the president cautioned that while the reforms agreed to are necessary, they might not be sufficient. In order to ensure that a stable recovery takes hold, the G-20 will meet again in the fall, Obama announced. While noting that it is important that nations agree on an action plan, the president said individual actions remain just as important.
While the major averages gave back some ground going into the close, they still ended the session firmly positive. The Dow closed up 216.48 points or 2.8 percent at 7,978.08, the NASDAQ closed up 51.03 points or 3.3 percent at 1,602.63 and the S&P 500 closed up 23.30 points or 2.9 percent at 834.38. With the gains, the Dow and the S&P 500 ended the session at their best closing levels in nearly two months, while the tech-heavy Nasdaq set a nearly three-month closing high.
In economic news, the Bank of Korea on Thursday said South Korea's foreign exchange reserves increased 2.3 percent month-on-month in March to US$206.34 billion. In February, it was US$201.54 billion. The increase in the reserves was mainly due to a weakness in the U.S. dollar, which boosted the dollar value of assets in other currencies. The increase recorded in March was the most in nearly three years.
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