Seoul shares expected to stay put this week

South Korean stocks are expected to move in a tight range this week with investors sitting on the sidelines amid the lack of major issues to push up the index further, analysts said Saturday.

The benchmark Korea Composite Stock Price Index (KOSPI) closed at 1,995.17 this week, down 0.05 percent from a week earlier, despite slight signs of recovery in the U.S. economy and Samsung Electronics’ record profit estimate.

The world’s largest smartphone maker reported a record operating profit guidance of 8 trillion won (US$7.2 billion) for the third quarter on Friday. The announcement propelled the index over the landmark 2,000-point level, but KOSPI soon lost steam and dropped down to 1,995.17.

Investors were cautious about other companies’ gloomy earnings outlook, analysts said.

“The third-quarter earnings season is set to start next week. But companies’ performances will continue to remain sluggish due to a deepening global slowdown,” said Lee Seung-woo, an analyst at KDB Daewoo Securities. “The index will gain no major momentum in the earnings season.”

Market watchers also said Europe issues are not strong enough to satisfy investors and spur the market.

There will be a meeting of European policymakers next week to discuss Spanish bailout plans, but it will take time for eurozone countries to make a decision due to divided opinions on the issue. (Yonhap News)