Seoul shares may backtrack to 2,110 next week amid uncertainties

SEOUL, April 22 (Yonhap) -- South Korean stocks may fall to the 2,110 level next week depending on corporate earnings results and the political situation in Europe, local analysts said Saturday.

The benchmark Korea Composite Stock Price Index (KOSPI) rose 1.41 percent this week to end up 0.50 percent at 2,149.15 on Friday.

Investor sentiment is set to be affected by the first-quarter earnings results to be released by large-cap companies such as cosmetics giant Amorepacific Corp. and top carmaker Hyundai Motor Co.

"The two companies represent (South Korean) businesses being affected by China's recent economic retaliation against the (ongoing) deployment of the Terminal High Altitude Area Defense (THAAD) system in South Korea," said Park Chun-young, an analyst at Daishin Securities Co.

"If they come up with worse-than-expected results for the first quarter, the main index may fall to 2,110," she said. The two firms earn a sizable amount of their earnings in China.

Moreover, foreigners may continue to shed South Korean stocks in the coming weeks depending on the political situations in France and Britain. In the past month, foreigners sold a total of 505.8 billion won (US$445 million) worth of stocks according to Daishin Securities.

In France's presidential race, voters will cast ballots in the first round of the election on Sunday and in a run-off election on May 7.

In Britain, lawmakers have backed Prime Minister Theresa May's plan for a general election on June 8, three years earlier than scheduled, to allow a new government to handle the Brexit issue. Britain has yet to start negotiations with other EU nations for its planned exit from the single economic entity in March 2019.

The main index, meanwhile, ended in positive territory this week on eased investor concerns following the United States' decision not to designate South Korea a currency manipulator.

Foreign and institutional buying worth a combined 323.75 billion won helped buoy the index.

Market bellwether Samsung Electronics Co. rebounded 1.19 percent to end at 2,038,000 won in Friday's session after falling 4.1 percent in the previous four days.

Meanwhile, the local currency rose 0.5 percent against the dollar this week, giving a boost to exporter stocks.

kyongae.choi@yna.co.kr
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