The stock market in South Korea opened strongly on Tuesday morning, defying the weak closing on Wall Street, led by automakers and financials. In the U.S., automakers led the decline after the Obama administration indicated that General Motors (GM) and Chrysler have not gone far enough in their restructuring plans and need to step up their efforts to reorganize in order to receive additional government aid. Financial stocks were also under stress after the Treasury Secretary stated that more banks might need more money than initially projected to clean up their balance sheets.
On Monday, the Dow closed down 254.16 points or 3.3% at 7,522, the Nasdaq closed down 43.40 points or 2.8% at 1,502 and the S&P 500 closed down 28.41 points or 3.5% at 787.
In Asian trading, crude oil is currently up $0.39 at $48.80 a barrel, in electronic trading. Light sweet crude for May delivery closed at $48.41 per barrel on the New York Mercantile Exchange on Monday, down $3.97 a barrel, on worries over the banking and automobile sectors in the U.S.
The benchmark KOSPI Index in South Korea opened Tuesday's session higher at 1,206, compared to its previous of 1,197, and is currently trading at 1,219, up 21.53, or 1.80%.
The local currency, the Won, opened lower against the US greenback at 1410.50 Won per US$, down from 1,391.50 Won, and is currently quoted at 1,403 Won per US$.
Manufacturing sentiment in the country rose, as more companies are optimistic that the recent stimulus package unveiled by the Government as well as steps initiated to revive the banking sector will yield positive results. According to Bank of Korea report, business survey index of manufacturers' expectations increased to 60 for April from 50 reported for March 2009.
Automakers and financials are leading the gains in the market, as investors had already discounted the weakness in the global auto industry.
Among the automakers, Hyundai Motor is gaining 4.91%, Kia Motor is advancing 4.22% and Ssangyong Motor is moving up 2.50%
Financials are also trading higher. KB Financial Group, the holding firm of Kookmin Bank, is moving up 1.78%, Shinhan Financial is advancing 4.53% and Woori Finance is gaining 2.53%.
Shipbuilders are also trading higher. Hyundai Heavy Industries is gaining 2.02%, Daewoo Ship building is moving up 2.16%, and Samsung Heavy Industries is advancing 2.37%.
Oil-related stocks are advancing on lower crude prices. SK Holdings is gaining 3.29% and S-Oil is rising 0.52%. Market heavyweight Samsung Electronics is moving up 1.76%.
Technology stocks are trading mixed. While LG Electronics is advancing 2.51%, and LG Display is gaining 3.47%, Hynix Semiconductor is losing 0.40%.
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