Seoul stocks likely to extend gains next week on earnings hope, dovish signals
SEOUL-- South Korean stocks are likely to extend gains next week as escalating virus woes are expected to be pared by hopes for strong earnings and reduced concern over faster than expected rate hikes in major economies.
The benchmark Korea Composite Stock Price Index (KOSPI) closed at 3,276.91 points on Friday, up 1.83 percent from a week ago.
The key stock index advanced this week in the face of mounting woes over virus outbreaks which have forced the country to adopt the toughest virus curbs in the greater Seoul area and heightened restrictions in other regions.
Foreigners bought a net 47.5 billion won on the main bourse, while institutions offloaded 156 billion won. Retail investors purchased a net 170 billion won.
Analysts said local stocks are likely to stretch gains in the coming week, backed by speculation that the central banks in the U.S. and Europe are unlikely to roll back their expansionary policies any time soon.
"Investors still have concerns about the rising inflation pressure, but the central banks in major economies signaled that they are willing to be patient about normalizing their easing policies," NH Investment & Securities analyst Kim Young-hwan said.
Kim said expectations for major exporters' earnings improvement run high, as global demand remains solid despite the rising virus cases at home and overseas.
South Korea's overseas shipments, which account for half of the economy, jumped 39.7 percent in June from a year ago.
Exports rose 14.1 percent on-year in the first 10 days of July, set to extend their gains to the ninth straight month in July if the current pace continues.
Source: Yonhap News Agency