RTTNews - The South Korean stock market has finished lower now in two of three trading days since the end of the four-day winning streak in which it had gathered more than 40 points or 3 percent. The KOSPI crashed through support at 1,400 points, but now investors are optimistic that the market could recoup some of those losses at the opening of trade on Friday.
The global forecast for the Asian markets is positive following U.S. President Barack Obama's historic speech in Egypt aimed at mending ties with the Muslim world. Some better than expected economic data out of the U.S. adds to the positive sentiment. The European markets finished mixed with a touch of upside, while the U.S. markets ended firmly in positive territory - and the Asian markets are forecast to move higher as well.
The KOSPI finished sharply lower on Thursday, due largely to continued profit taking from the recently concluded winning streak. Shipbuilders, financials and industrials ended with significant declines, while the technology shares provided a modicum of support.
For the day, the index plummeted 36.75 points or 2.6 percent to close at 1,378.14 after trading between 1,375.94 and 1,411.11.
Among the decliners, POSCO fell 3.9 percent, while Daewoo Engineering & Construction plunged 10.3 percent, SK Energy lost 0.9 percent, STX Pan Ocean dropped 9.5 percent, Hyundai Heavy Industries declined 4.9 percent, Daewoo Shipbuilding & Marine Engineering was 1.7 percent lower, KB Financial Group fell 4.8 percent and Woori Finance Holdings lost 6.1 percent.
Finishing higher, Samsung Electronics was up 0.5 percent and Hyundai Motor was 1.8 percent higher.
The lead from Wall Street is optimistic as stocks resumed their upward move on Thursday following a modest pullback in the previous session. The major averages firmed their position in positive territory in mid-afternoon trading after an uncertain start to the day's session, posting strong gains on the day.
Ahead of the start of trading, traders were presented with employment data from the Labor Department that showed a decrease in first time jobless claims for the week ended May 30. The report also indicated the first decrease in continuing claims in 20 weeks as initial jobless claims fell to 621,000 from the previous week's revised figure of 625,000. Economists had been expecting jobless claims to edge down to 620,000 from the 623,000 originally reported for the previous week.
Continuing claims fell to 6.735 million in the week ended May 23 from the preceding week's revised level of 6.750 million. The modest decrease in continuing claims breaks a recent streak of record highs and marks the first decrease since the week ended January 3.
In a separate report, the Labor Department revised its labor productivity figures for the first quarter, revealing a mild increase in the pace of growth. The report also showed that unit labor costs increased by less than previously estimated.
On the corporate front, membership warehouse operator Costco Wholesale (COST) reported a 7 percent drop in its comparable sales for the four-week period ended May 31 with a 5 percent decline in net sales. A number of other retailers also reported their monthly sales results, with Abercrombie & Fitch (ANF), J.C. Penney (JCP), Bon-Ton (BONT) and American Apparel (APP) all reporting declining sales on a comparable store basis.
Retail giant Wal-Mart (WMT) did not release its monthly sales results, however, as the company announced last month that it would cease providing its monthly results.
The upward move seen over the course of the trading day came as traders shrugged off some uncertainty ahead of Friday's report from the Labor Department detailing the employment situation for the month of May.
The major averages saw further upside in late session trading and closed just off of their best levels of the day. The Dow climbed 74.96 points or 0.9 percent to 8,750.24, the NASDAQ finished up 24.10 points or 1.3 percent at 1,850.02 and the S&P 500 closed up 10.70 points or 1.1 percent at 942.46.
In economic news, the Finance Ministry said on Thursday that uncertainty in global financial markets and concerns over increasing oil prices continue. As the economy is facing such uncertainties, it is too early to be optimistic about the outlook. The government said it will continue expansionary macroeconomic policies.
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