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(LEAD)Seoul stocks sharply rebound on dip-buying, ahead of Biden visit

Stocks 16:35 May 20, 2022

(ATTN: ADDS bond yields at bottom, photo)

SEOUL, May 20 (Yonhap) -- South Korean shares advanced Friday as investors scooped up oversold stocks and pinned hopes for expanded business ties between South Korea and the United States. The Korean won steeply rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) added 46.95 points, or 1.81 percent, to close at 2,639.29 points. After a volatile week from high inflation, the key stock index gained 1.35 percent from a week ago.

Friday's trading volume was moderate at about 743 million shares worth some 9.5 trillion won (US$7.5 billion), with gainers outnumbering losers 654 to 189.

Institutions bought a net 837 billion won and foreigners purchased 194 billion won, while retail investors offloaded 1 trillion won.

Electronic signboards at a Hana Bank dealing room in Seoul show the benchmark Korea Composite Stock Price Index (KOSPI) closed at 2,639.29 points on May 20, 2022, up 46.95 points or 1.81 percent from the previous session's close. (Yonhap)

The KOSPI's rebound came after Thursday's global stock plunge.

Overnight, the Dow Jones Industrial Average and the tech-heavy Nasdaq composite declined, largely on continued pressure on inflation hikes.

After a bullish start, the KOSPI increasingly gained ground Friday on advances by tech, auto and chemical heavyweights.

Institutions and foreign investors bought stocks as U.S. President Joe Biden's visit to South Korea raised rosy expectations that key sectors, such as autos and batteries, would get a boost from the summit. The U.S. is one of South Korea's two largest trade partners, along with China.

"Despite continued worries about stagflation (from high inflation pressure and weak growth), investors pinned high hopes on the Korea-U.S. summit. Steel performed strong in particular on hopes of Biden's possible deregulation on the sector, and autos swelled on reports that Biden will meet with (Hyundai Motor Group Chairman) Chung Eui-sun," the Shinhan Investment research team said.

Most large caps closed higher in Seoul.

The KOSPI's top cap, Samsung Electronics, moved up 0.74 percent to 68,000 won, and battery giant LG Energy Solution jumped 4.45 percent to 434,000 won.

No. 2 chipmaker SK hynix advanced 1.35 percent to 112,500 won, and the country's largest automaker, Hyundai Motor, added 2.47 percent to 186,500 won. Chemical heavyweight LG Chem soared 8.57 percent to 545,000 won.

The local currency closed at 1,268.1 won against the U.S. dollar, up 9.6 won from the previous session's close.

Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasurys lost 3.5 basis points to 3.011 percent, and the return on the benchmark five-year government bond fell 4.8 basis points to 3.203 percent.

jwc@yna.co.kr
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