Seoul shares start higher on Fed rate hike

South Korean stocks cheered on Thursday the U.S. Federal Reserve's decision to raise interest rates by a quarter point for the first time in an almost decade.
  

The benchmark Korea Composite Stock Price Index added 17.14 points, or 0.87 percent, to 1,986.54 in the first 15 minutes of trading.
  

Hours before the local market opening, the Fed raised the target rate for the federal fund rates from 0-0.25 percent, to 0.25-0.50 percent in a show of confidence in its economic conditions. It is the first rate hike since June 2006.
  

Guarding against attaching too much significance to the first rate hike, Fed Chair Janet Yellen stressed that it is "pre-emptive," and any future tightening would be "gradual."
  

The long-anticipated rate hike, wrapped in dovish language, relieved investors, leading the Dow Jones industrial average to surge 1.28 percent and the Nasdaq to jump 1.52 percent overnight.
  

"The market heard what it had expected and uncertainties are now gone," said Park Seok-hyun, researcher at Eugene Investment & Securities. "The favorable atmosphere would encourage investors to begin hunting for such oversold local shares as builders, tech firms and securities."
  

Foreigners, who had been net sellers over the past two weeks, were picking up shares together with institutions, offsetting the sell-off by retail investors. 
  

Most of large-cap shares were trading bullish, with tech and chemicals leading the overall gains.
  

Market bellwether Samsung Electronics gained 0.31 percent, and industry leader LG Chem jumped 1.72 percent.
  

The local currency was trading at 1,176 won against the U.S. dollar as of 9:15 a.m., up 2.05 won from Wednesday's close. (Yonhap)