Seoul shares forecast to remain range-bound next week

SEOUL, July 23 (Yonhap) -- South Korean shares are expected to remain in a tight range next week as investors take to the sidelines ahead of key economic events and attempt to cash in on gains, analysts said Saturday.

The benchmark Korea Composite Stock Price Index (KOSPI) closed at 2,010.34 points on Friday, down 0.34 percent from a week ago.

The country's stock market started lower despite a continued foreign buying, as local investors tried to lock in gains.

This week, foreign investors scooped up local stocks worth 800 billion won (US$704 million), while institutional investors sold roughly the same amount. Foreign investors extended their buying binge to an 11th consecutive day, but market expectations about a rate hike in the U.S. are running high, which will limit a sharp rise in the local stock market.

The U.S. Federal Reserve is set to decide its policy rate on July 27.

Market analysts say foreign investors' appetite for local stocks will remain firm on the back of extended monetary easing in major economies, but local institutional investors may continue to sell stocks to meet bond redemptions.

"Investors are expected to realize their recent gains, and a steady rise in the local stock market may be in the offing, but its pace may be limited," said Koh Seung-hee, an analyst at KDB Daewoo Securities Co.

Medical equipment and brokerage stocks were among the winners by rising 5.2 percent and 4.1 percent each, while pharmaceuticals and steelmakers traded bearish this week, moving down 2 percent and 1.8 percent.

sam@yna.co.kr
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