Shares jump 1.71% on Spain bailout

South Korean stocks shot up 1.71 percent Monday after Europe’s finance ministers agreed on a bailout program for Spain over the weekend, analysts said. The local currency rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index spiked 31.40 points to 1,867.04. Trading volume was light at 356 million shares worth 4.21 trillion won ($3.61 billion), with gainers outpacing losers 647 to 199.

“The eurozone’s decision to help Spain’s banking sector alleviated global stock market uncertainties to some extent that weighed down prices in the past,” Park Jung-jae, an analyst for Korea Investment & Securities, said.

He said Europe’s pledge to inject up to 146 trillion won, gave positive signals to investors and stock markets all over the world and soothed anxieties over the outcome of Greece’s upcoming elections.

The Greek election slated for Sunday will determine if the country stays inside the 17-member currency union or takes steps to exit it.

Hyundai Securities analyst Bae Sung-young said the news from Europe is expected to help the KOSPI make gains this week if there are no sudden developments that raise downside risks.

Others said that the rally on Wall Street late last week, contributed to the solid gains on the local bourse that generally track the U.S. market.

Most big-cap shares in electronics, autos, steel, chemicals and heavy industries moved up with some financials posting losses.

Market bellwether Samsung Electronics jumped 1.68 percent to 1,268,000 won, with top automaker Hyundai Motor moving up 1.48 percent to 240,000 won.

No. 2 carmaker Kia Motors added 1.17 percent to 77,900 won, with LG Chem, a leading manufacturer of rechargeable batteries, surging 6.67 percent to 288,000 won.

Hyundai Heavy Industries, the world’s largest shipmaker, soared 3.82 percent to 272,000 won, with global steelmaker POSCO rising 1.35 percent to 375,500 won. Leading refiner SK Innovation spiked

6.72 percent to 143,000 won, although top mobile carrier SK Telecom ended the day flat at 122,500 won.

Top life insurer Samsung Life Insurance, however, fell 0.72 percent to 96,000 won, while Samsung Fire & Marine Insurance dropped 2.43 percent to 201,000 won.

The local currency finished at 1,165.9 won to the U.S. greenback, up 9.5 won from Friday’s close. 

(Yonhap News)