Seoul: South Korean stocks traded slightly higher late Monday morning, led by foreign buying, as investors welcomed the government's decision to scrap a plan to lower the threshold of major shareholders subject to the capital gains tax. The benchmark Korea Composite Stock Price Index (KOSPI) added 10.73 points, or 0.32 percent, reaching 3,406.27 as of 11:20 a.m.
According to Yonhap News Agency, the index opened higher on robust foreign buying, although some of the earlier gains were reduced due to profit-taking by individual and institutional investors. The KOSPI has shown a rally in recent sessions, achieving a new record high for the third consecutive day last Friday, closing at 3,395.54.
Investor sentiment received a boost from the news that the government decided to maintain the threshold for the capital gains tax on stock holdings at the current level of 5 billion won (US$3.6 million). This decision came as a reversal of the earlier proposal to lower it to 1 billion won, which faced opposition from investors.