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(LEAD) Seoul stocks hit 1-month high on China's policy tweak, Fed rate cut hope

All News 17:07 June 11, 2019

(ATTN: ADDS bond yields at bottom)

SEOUL, June 11 (Yonhap) -- South Korean stocks rose to a one-month high Tuesday, as China's exports remained bullish in May and it eased rules on local government spending on public projects. The Korean won gained ground against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) rose 12.32 points, or 0.59 percent, to close at 2,111.81. Trade volume was moderate at 542 million shares worth 4.1 trillion won (US$3.5 billion), with gainers far outnumbering losers 646 to 183.

The local stock market opened mildly lower but soon turned upward in the late morning session on news that China's outbound shipments rose last month in the face of the escalating trade friction with the United States.

Also, China eased rules on local government spending on infrastructure projects, which was interpreted as signaling that it is working on boosting its economy. China's stock market surged.

"Hopes for trade talks between the U.S. and China, coupled with the rise in the Chinese stock market pushed up the local stock market," said Seo Sang-young, an analyst at Kiwoom Securities.

Foreign and institutional investors scooped up a net 68.4 billion won and 203.2 billion won worth of local stocks, respectively, while individuals offloaded a net 266.1 billion won.

Tech shares led the market gain, with top cap Samsung Electronics inching up 0.11 percent to 44,850 won to extend its winning streak to a fourth day. Its smaller rival LG Electronics surged 6.03 percent to 82,600 won on prospects that its smartphone business will improve down the road. SK hynix, a global chipmaker, was up 0.6 percent to 67,200 won.

Automakers traded mixed, with industry leader Hyundai Motor moving up 0.35 percent to 143,500 won, while its smaller affiliate Kia Motors declined 0.47 percent to 42,800 won.

No. 1 airline Korean Air inched down 0.15 percent to 32,450 won and its holding firm, Hanjin KAL, fell 2.65 percent to 42,250 won on news that the younger daughter of the late chairman, Cho Yang-ho, returned to two management positions at logistics-centered Hanjin Group, over one year after she was forced to resign amid controversy over her misbehavior.

The local currency closed at 1,180.4 won against the U.S. dollar, up 4.8 won from the previous session's close.

Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys added 0.9 basis point to 1.542 percent, and the return on benchmark five-year government bonds was up 1.1 basis points to 1.588 percent.


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