South Korean shares climbed to a fresh 1-month intra-day high on Tuesday as investors bet that the probability of a Greek exit from the euro zone remained low, despite an election victory by the anti-austerity Syriza party.
The Korea Composite Stock Price Index (KOSPI) was up 0.39 per cent at 1,943.27 points as of 0215 GMT. Greece’s left-wing leader Alexis Tsipras was sworn in on Monday as the Prime Minister of the first euro zone government openly resisting austerity, putting the country on a potential collision course with international creditors.
“Of course, there will be friction when the two parties meet to renew the country’s bailout terms, but it is also in their mutual interest to ensure that Greece stays in the euro zone,’’ said Kim Jong-soo, an economist at Taurus Securities.
“The euro zone’s other peripheral economies are also in a much healthier state compared to the previous crisis and the establishment of the ESM and banking unions have removed many systematic weaknesses,’’ he added.
Bargain hunters locked in on recently-battered energy counters, with LG Chem surging 4.6 per cent, while SK Innovation gained 3.2 per cent.
Shares in LG Display, a major supplier of screens for Apple Inc, gained 3 per cent with market players predicting record-high iPhone sales in the last quarter ahead of the Silicon Valley giant’s earnings announcement.
Kia Motors fell for a fifth-straight session, sliding 1.9 per cent as a prolonged weakness in the Russian rouble dimmed Kia’s earnings outlook, reflecting the automaker’s significant presence in Russia.
Gains were spread across the main board, with 13 out of the 17 industry sub-indices tracked by the bourse operator up in positive territory.
Foreign investors bought a net 33.9 billion won ($31.3 million) worth of KOSPI shares by late morning.
The South Korean won held steady on Tuesday morning, as investors looked for further cues ahead of the US Federal Reserve’s two-day policy meeting set to begin later in the day.
The local currency was trading at 1,081.7 to the dollar as of 0215 GMT compared with 1,080.8 quoted at the end of Monday’s session.
March futures on three-year treasury bonds shed 3 basis points to trade at 108.54.