Market Commentary and Intraday News
South Korea Stocks May Challenge Resistance At 1,900 Points
289 days ago
(RTTNews) - The South Korea stock market on Monday wrote an emphatic finish to the three-day losing streak in which it had declined more than 30 points or 1.7 percent. The KOSPI finished just below the 1,885-point plateau, and now traders are looking for additional support when the market opens on Tuesday.
The global forecast for the Asian markets remains upbeat following good news regarding the European debt concerns. Greece's international creditors said the embattled euro area member is committed to the planned budget cuts. Profit taking may limit the upside, along with remarks by Italian Prime Minister Mario Monti - who warned that Europe is facing the threat of a psychological disintegration. The European and U.S. markets finished higher, and the Asian bourses are expected to open in similar fashion.
The KOSPI finished sharply higher on Monday, supported by gains from the technology stocks, shipbuilders and oil companies.
For the day, the index surged 37.20 points or 2.01 percent to finish at 1,885.88 after trading between 1,881.86 and 1,894.92. Volume was 242.6 million shares worth 4.13 trillion won. There were 562 gainers and 242 decliners.
Among the gainers, Samsung Electronics soared 4.42 percent, while SK Hynix climbed 3.82 percent, SK Innovation spiked 4.81 percent, S-Oil jumped 3.89 percent, Hyundai Heavy Industries surged 4.07 percent and Daewoo Shipbuilding and Marine Engineering collected 3.94 percent.
The lead from Wall Street is positive as stocks gave back ground in the latter part of Monday's trade but still ended mostly higher after seeing early strength. The markets extended the strong upward move that began Friday. Despite the late-day pullback, the major averages all ended the session at their highest closing levels in three months.
The early upward move came as traders continued to react positively to last Friday's monthly jobs report, which showed that the U.S. economy added 163,000 jobs in July compared to expectations for an increase of 100,000 jobs. However, the unemployment rate unexpectedly edged up to 8.3 percent in July from 8.2 percent in June.
Optimism about the financial situation in Europe also contributed to the early strength, with traders expecting the European Central Bank to take additional steps to address the ongoing debt crisis. Buying interest was also generated by news that Greece and its international creditors have agreed on the need to strengthen policy efforts and meet the country's bailout conditions. The lenders are set to resume discussions with Greek authorities next month.
But remarks by Italian Prime Minister Mario Monti helped to limit the upside for the markets, as he warned that Europe is facing psychological disintegration and urged all leaders to become more independent from their parliaments. In an interview with German magazine Der Spiegel, Monti said the debt crisis risks the future of the single-currency bloc.
Among individual stocks, shares of Best Buy moved sharply higher on news that the consumer electronic retailer's founder and chairman Richard Schulze offered to acquire the company for $24 to $26 per share in cash. On the other hand, Knight Capital Group came under pressure after the financial services company said it has entered into an agreement for the sale of stock in an effort to survive the huge trading loss it incurred on erroneous trades.
The major averages showed a notable move to the downside going into the close but ended the day in positive territory. The Dow edged up 21.34 points or 0.2 percent to finish at 13,117.51, while the NASDAQ rose 22.01 points or 0.7 percent to end at 2,989.91 and the S&P 500 crept up 3.24 points or 0.2 percent to 1,394.23.
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