Seoul: South Korean stocks extended their winning streak to five straight sessions Monday as disappointing U.S. economic data stirred up hopes for a possible rate cut by the Federal Reserve amid uncertainties surrounding tariff policies. The local currency gained against the U.S. dollar.
According to Yonhap News Agency, the benchmark Korea Composite Stock Price Index (KOSPI) added 19.37 points, or 0.75 percent, to close at 2,610.42, marking the fifth consecutive session of increase. This marked the highest closing since October 29, when the index finished at 2,617.8. Trade volume was moderate at 356.4 million shares worth 10.8 trillion won (US$7.49 billion), with winners outnumbering losers 619 to 264.
Institutions bought a net 216.4 billion won worth of local shares to continue the rally, while foreign and retail investors sold a net 223.6 billion won and 30.6 billion won, respectively. Experts pointed to the lower-than-expected January retail sales data that showed the biggest drop in nearly two years, fueling speculation that a rate cut could be on the horizon.
Markets were also relieved by U.S. President Donald Trump's announcements not to immediately impose major tariffs, which had been previously threatened. Investors are also keeping a close eye on the planned talks between the United States and Russia aimed at ending the war in Ukraine.
Battery and chemical shares led the upside move. Leading battery maker LG Energy Solution edged up 0.14 percent to 353,500 won, and Samsung SDI added 2.81 percent to 219,500 won. LG Chem, a major chemicals maker, jumped 4.4 percent to 237,500 won, and Lotte Chemical surged 7.46 percent to 63,400 won.
Leading non-life insurer Samsung Fire and Marine Insurance vaulted 8.42 percent to 425,000 won, and major banking group KB Financial Group went up 1.63 percent to 81,000 won. Defense giant Hanwha Aerospace soared 8.26 percent to 577,000 won, and flagship air carrier Korean Air increased 2.58 percent to 23,850 won.
However, automakers finished in negative territory as Trump announced plans to impose tariffs on imported cars on April 2. South Korea is one of the few countries that have duty-free access to the U.S. Top carmaker Hyundai Motor sank 3.01 percent to 199,800 won and its sister Kia dropped 0.74 percent to 94,300 won.
The local currency was quoted at 1,441.7 won against the greenback at 3:30 p.m., up 1.8 won from the previous session. Bond prices, which move inversely to yields, closed lower. The yield on three-year Treasurys climbed 1.2 basis points to 2.623 percent, and the return on the benchmark five-year government bonds added 1.8 basis points to end at 2.729 percent.