Korea’s bourse is expected to feel the effects of eurozone woes with stocks prices likely to remain locked this week despite modest gains made coming into the new year, local analysts said Saturday.
The benchmark KOSPI gained 0.95 percent from the previous week’s closing to end the first week of trading in 2012 at 1,843.14 points.
The 17.40 point gain comes despite unfounded rumors about a nuclear accident in North Korea that caused the KOSPI to temporarily fall sharply for a time on Friday.
Analysts said last week’s gains were possible because investors were generally buoyed by upbeat sentiment of stronger than forecast economic recovery in the United States.
They, however, said that persistent fiscal challenges facing many European countries will continue to weigh down the stock market.
“The eurozone crisis is expected to become the main source of concern after being sidelined in recent weeks,” said Lee Seung-woo, an analyst from Daewoo Securities Co.
He pointed out that while summit meetings between the heads of Germany, France and Italy are planned for this week, it is highly unlikely the talks will resolve difficult outstanding issues.
Other experts said that such uncertainties have even dampened forecasts by Samsung Electronics Co., the world’s largest maker of memory chips and smartphones, that it would post record operating profit in the fourth quarter on the back of strong sales of smartphones.
“Overall, stock prices are forecast to remain unchanged through next week’s trading session,” many local analysts said. They added that investors may start taking a closer look at developments taking place in Europe which can influence the overall global financial market.
(Yonhap News)
