Seoul shares up 2.77% on European optimism

South Korean stocks finished 2.77 percent higher on Friday as investor sentiment was boosted by eased Italian debt woes, analysts said. The local currency rose against the U.S. dollar.

The benchmark Korea Composite Stock Price Index jumped 50.2 points to 1,863.45, rebounding from a massive 94-point fall on the previous session. Trading volume was light at 291.7 million shares worth 5.15 trillion won ($4.57 billion) with gainers leading losers 682 to 170.

“The European Central Bank bought Italian bonds, relieving market anxiety,” said Lee Jae-hoon, a market analyst at Mirae Asset Securities Co. “But it’s too early to be optimistic. There remains uncertainty and it may lead to a more volatile market.”

The ECB’s more active role in dealing with Italy’s debt problem is required to help stocks continue to move upward, Lee said. A parliamentary vote for Italy’s austerity plans over the weekend will also be the key to encouraging investors.

Foreigners extended their selling streak to three sessions, offloading a net 261.2 billion won of local shares, while institutional investors scooped up a net 280.4 billion won.

Tech shares had the biggest gains in the bullish market, with world’s second-biggest handset maker Samsung Electronics jumping 5.13 percent to 983,000 won and its smaller rival LG Electronics gaining 6.43 percent to close at 64,600 won.

Hynix Semiconductor edged 0.23 percent up to 21,550 won after SK Telecom bid for a major stake in the world’s No. 2 memory chipmaker. The country’s biggest mobile carrier rose 3.1 percent to finish at 149,500 won. 

(Yonhap News)