The Korean stock market has turned quite subdued after a positive start this morning, with participants treading a cautious path with a few markets in the Asia-Pacific region exhibiting weakness despite a strong close on Wall Street.
The benchmark KOSPI index rose to 1,367 earlier this morning, but is trading at 1,350 now, down 3.72 points from its previous close.
Heavyweight stock Samsung Electronics is down by around a per cent. Shipbuilder Hyundai Heavy Industries is up 3.5%. Daewoo Shipbuilding is trading 1.5% up. However, Samsung Heavy Industries is down in the red with a small loss. Telecom stocks are trading mixed.
Among autombile stocks, Kia Motors and Ssangyong Motor are trading higher by 4% and 2.3% respectively. Hyundai Motor is down with a marginal loss. Tech stock Hynix Semiconductor is up 2.3%. Among other tech majors, LG Display LCD and LG Electronics are trading lower by 2.4% and 1.9% respectively.
Airliners Korean Air Line and Asiana Air Line are trading weak. Korean Air Line is down by over 4% while Asiana Air Line is trading 2.5% down.
Steel stocks Hyundai Steel and POSCO are up 1.5% and 1.8% respectively. Energy stock KEPCO is down with a marginal loss.
Among bank stocks, Korean Exchange Bank is up 0.7%. Woori Finance and KB Financial, the holding firm of Kookmin Bank, are down with marginal loss.
Among other markets in the Asia-Pacific region, Australia and Japan are trading firm. New Zealand is up marginally. Singapore and Hong Kong are exhibiting weakness.
Wall Street had closed with strong gains on Friday as participants stepped up buying on hopes the economic downturn may be slowing. Better-than-expected new home sales and durable goods orders aided sentiment to an extent.
According to a report from the Commerce Department, new home sales saw a modest rise in March, although the annual rate of new home sales came in well above economist estimates due to an upward revision to February sales. The report showed that new home sales fell 0.6 percent to an annual rate of 356,000 in March from a revised February rate of 358,000. Economists had expected new home sales to remain unchanged compared to the 337,000 originally reported for the previous month.
Earlier, a separate report from the Commerce Department showed that durable goods orders fell 0.8 percent in March following a downwardly revised 2.1 percent increase in February. Economists had expected orders to fall 1.5 percent.
Wall Street's real focus was on the details of the government's measures with regard to a series of stress tests at 19 leading U.S. banks. Though actual results from the tests will be available after May 4, investors hoped to gain insight into the conclusions that government officials reached. The report acknowledged that most U.S. banking organizations currently have capital levels well in excess of the amounts required to be considered well capitalized. Meanwhile, Fed regulators generally assert that banks should be prepared for the worst.
American Express and Ford reported better-than expected earnings. Earnings will remain in focus on Monday with a lot more companies confirming that they well announce their latest quarterly results before commencement of trading.
Ford reported an after-tax net loss of $0.75 per share, but analysts expected a loss of $1.23 per share. While the loss continues to indicate weakness in the auto sector, the better-than-expected result shows that improvements are being made at Ford.
Meanwhile, Microsoft's third quarter earnings met expectations after excluding special charges. The software giant reported third-quarter earnings of $0.33 per share, including two charges that reduced earnings by $0.06 per share, while analysts had expected Microsoft to earn $0.39 per share.
June crude oil rose throughout the session. A weak dollar and interest in equities led the crude contracts to close at $51.54 per barrel, up 3.9%.
The Dow ended 119 points up, the Nasdaq moved up 42 points and the S&P 500 index gained 14 points.
In the Asia-Pacific region, most of the markets closed lower on Friday. Japan's benchmark Nikkei 225 fell 1.6%. Hong Kong's Hang Seng index bucked the downtrend and edged up by 0.3 per cent.
Major European markets ended Friday's session near their highs of the day, with the U.K.'s FTSE 100 Index closing up 3.4 percent, while the French CAC 40 Index and the German DAX Index rose 3.1 percent and 3.0 percent, respectively.
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