Seoul stocks up for 2nd day as investors disregard US inflation

South Korean stocks advanced for the second straight session Friday despite the steep hike in the US price gauge, as investors believed the price pressure is still short of triggering talks of tapering by the Federal Reserve. The Korean won rose against the US dollar.

The benchmark Korea Composite Stock Price Index (Kospi) increased 24.68 points, or 0.77 percent, to close at 3,249.32 points.

Trading volume was moderate at about 1.6 billion shares worth some 17.6 trillion won ($15.8 billion), with gainers outnumbering losers 517 to 335.

Foreigners bought a net 274 billion won, while retail investors sold 478 billion won. Institutions purchased a net 176 billion won.

The Kospi got off to a strong start on overnight Wall Street tech gains, as investors shrugged off the consensus-beating US consumer price index (CPI) for May. The price index expanded 5 percent, marking the highest on-year jump since 2008.

Optimism about a quick economic rebound also drove up the stock prices, following a 40.9 percent on-year jump in South Korean exports in the first 10 days of June.

"Investors seem to have taken the US CPI data for May as a passing variable that resulted from the baseline effect and short supply (of chips)," said HI Investment & Securities analyst Park Sang-hyun.

Most large caps closed higher in Seoul.

Market bellwether Samsung Electronics closed unchanged at 81,000 won, while No. 2 chipmaker SK hynix jumped 4.07 percent to 128,000 won.

Electric vehicle battery maker Samsung SDI surged 4.59 percent to 638,000 won, but internet portal operator Naver moved down 0.27 percent to 372,500 won. Giant pharmaceutical firm Samsung Biologics declined 1.17 percent to 845,000 won.

Top automaker Hyundai Motor increased 1.06 percent to 238,500 won, and leading chemical firm LG Chem spiked 5.33 percent to 850,000 won.

The local currency closed at 1,110.8 won against the US dollar, up 5 won from the previous session's close. (Yonhap)