Seoul shares eye 2,000-point plateau next week

SEOUL, Feb. 28 (Yonhap) -- South Korean stocks are expected to keep an upward tempo toward the 2,000-point level next week as major economies are set to start their monetary easing, analysts said Saturday.

The benchmark Korea Composite Stock Price Index (KOSPI) closed at 1,985.8 on Friday, up 24.35 points, or 1.24 percent, from a week ago.

After the Lunar New Year holiday last week, the index gained strong traction after the European Union agreed on a four-month extension of the Greek bailout program and the U.S. Fed minutes disclosed that the central bank was not in a hurry to raise key rates.

On Wednesday, KOSPI surpassed the 1,990-point line for the first time in nearly five months on dovish comments from Fed Chair Janet Yellen that she will be patient about increasing rates.

Investors turned cautious Friday after a seven-straight session rally, with KOSPI slipping 0.37 percent.

Foreigners led the rally to scoop up a net 723.6 billion won (US$659.1 million) worth of local shares over the one-week period, while retail investors and institutions dumped a net 567.4 billion won and 115 billion won, respectively.

Tech-rich KOSDAQ also staged a bullish run to close at a seven-year high of 624.56 points on Friday.

Celltrion, a bio-pharmaceutical firm that ranks second in the secondary bourse by market value, led the rally from the beginning of the week as it surged nearly 14 percent on Monday.

For the coming week, KOSPI will likely reach the 2,000-point mark on the back of strong foreign buying spurred by a set of events in Europe and China, analysts said.

The European Central Bank will hold a policy meeting on Thursday to start the bond-buying program worth 1.1 trillion euros to boost the sluggish economy, lifting investor sentiment to bet on emerging markets including South Korea.

China is expected to adopt another stimulus plan to cushion the economic slowdown at political meetings scheduled for Tuesday and Thursday.

"Some recent economic data showed that China's economy was recovering, but its exports and employment still remained sluggish," said Noh Aram from KDB Daewoo Securities Co. "(The Chinese central bank) can opt for a rate cut."

Experts say investors, however, will want more clear signs of economic recovery before pushing the index beyond 2,100 points, which has been out of reach since Aug. 2, 2011 when it finished at 2,121.27.

"The index will move further upward after checking the Seoul government's fiscal support and better corporate earnings," said Bae Sung-young, a senior analyst at Hyundai Securities Co.

brk@yna.co.kr
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