Seoul bourse to keep upturn next week on ample liquidity

SEOUL, April 25 (Yonhap) -- The South Korean stock market is expected to keep its upward trend next week as ample global liquidity continues to fuel a buying spree by foreign investors, analysts said Saturday.

The Korea Composite Stock Price Index (KOSPI) closed at 2,159.8 on Friday, up 16.3 points, or 0.76 percent, from a week ago, keeping a four-week winning streak.

The rallies were mostly driven by massive foreign buying. Foreigners bought more shares than they sold for the past 14 straight sessions.

Foreign buying, coupled with improved sentiment following better-than-expected earnings for major companies, pushed the market higher. The upward trend lost some traction later in the week as institutions intensified offloading large cap shares.

Next week, investors will pay attention to the U.S. Federal Open Market Committee meeting scheduled for Thursday, but analysts say it will not have a meaningful impact as expectations remain high that it would not change its current monetary policy.

Another indicator under scrutiny is the first-quarter gross domestic product figures for the U.S. economy. A slowing growth rate could lower chances for a rate hike, analysts said.

With those factors in mind, some said that the market could move up and down slightly in a narrow range earlier next week but that it will soon stabilize before the end of the week.

"The index will go through a little bit of fluctuations but it will stabilize near the end of the week," said Lee Kyung-min, an analyst from Daishin Securities Co.

"We expect that the market will move like this week when investors tend to flock to stocks that have been sidelined from recent rallies, a pattern that has supported the overall market over the past few weeks," he added.

The stock market will be shortened to four-day trading next week as it closes on Friday to mark Labor Day.

kokobj@yna.co.kr
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