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4 months ago
S.Korea stocks hit record high on strong earnings bets, won slips after Fed
May 4, 2017 / 2:58 AM / 4 months ago

S.Korea stocks hit record high on strong earnings bets, won slips after Fed

    * Expectations for stronger economy high ahead of
presidential election
    * KOSPI may touch as high as 2,350 in coming months -analyst
    * Won edges down on Fed's signal for two more rate hikes

    SEOUL, May 4 (Reuters) - South Korean shares firmed to a
record high on Thursday on upbeat forecasts for second-quarter
corporate earnings while hopes a new South Korean president
would provide economic stimulus supported sentiment.
    The Korea Composite Stock Price Index (KOSPI)         was up
0.6 percent at 2,233.63 points as of 0221 GMT. Earlier in the
session, it hit an all-time high of 2,234.38.
    Stoking demand are high expectations a new South Korean
leader will boost spending to support economic growth, which
would be positive for corporates. South Koreans head to the
polls to vote for a new president on May 9.
    "Market participants' expectations for stronger South Korean
economy are high as all of the candidates have promised to boost
domestic demand," said Song Seung-yeon, a stock analyst at Korea
Investment & Securities.
    Song expects strong exports to support corporate earnings in
the second quarter. She added the index would soon reach as high
as 2,350 points, possibly later in the first half or early part
of the second half of this year.
    "The KOSPI may retreat from then on as the U.S. Federal
Reserve seems likely to raise rates in its coming policy
meetings," added Song.
    Offshore investors were set to be net buyers, purchasing
156.6 billion Korean won ($138.29 million) worth of KOSPI shares
near mid-session. 
    Market heavyweight Samsung Electronics             was up
1.2 percent, set for an eighth straight session of gains.
    Shares of Amorepacific             gained nearly 4 percent. 
    Advancing issues outnumbered declining ones by 488 to 282.
    The South Korean won        was weaker after the U.S.
Federal Reserve kept rates unchanged at its May policy meeting
but downplayed recent economic weakness, a sign it was still on
track for two more rate rises this year.             
    The won            stood at 1,132.4 to the dollar, down 0.2
percent compared to the previous close of 1,130.5.
    June futures on three-year treasury bonds         shed 0.01
point to 109.37, after sagging in early trade due to high demand
for equities. 
    
                       0221 GMT    Prev close
 Dollar/won             1,132.4       1,130.5
 Yen/won             10.0355/35       10.0457
 *KTB futures            109.37        109.38
 KOSPI                 2,233.62      2,219.67
 * Front-month futures on three-year treasury bonds
    

 (Reporting by Dahee Kim; Editing by Sam Holmes)
  

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