The course of rising oil prices and a weakening Japanese yen will likely affect the direction of Seoul shares this week, analysts said Saturday.
The benchmark KOSPI settled at 2,034.63 last week, gaining 14.74 points, or 0.73 percent, from a week earlier.
The KOSPI got off to a weak start, slipping to the 1,990 level, amid concerns over a surge in global oil prices and a weakening yen.
The benchmark index, however, recovered later in the week after the Group of 20 countries voiced concerns over spiking oil prices.
Better-than-expected U.S. economic data and Italy’s successful debt sale also gave a boost to investor sentiment, according to analysts.
Analysts also forecast rising global oil prices will continue to weigh down the benchmark index this week. As of Friday, Dubai crude oil ended at $122.25, jumping $2.61 from the previous session.
While the Iran elections and an upcoming summit between Israel and the U.S. may put the brakes on surging oil prices, market watchers said such chances are expected to be slim.
They also said a weakening yen is likely to erode South Korean firms’ export competitiveness and dent their share prices.
“If the market turns lower, this may be largely due to a rise in global oil prices and a weakening yen,” said Lee Seung-woo, an analyst at Daewoo Securities Co.
Investors should keep tabs on moves of the two factors as well as economic data, such as China’s consumer prices and exports as well as February U.S. jobs data, which are expected to be released this week, analysts said.
(Yonhap News)
