KOSPI expected to move in tight range next week

South Korean shares are expected to move in a tight range in the coming week on rising uncertainties in eurozone and a looming interest rate hike in the US, analysts said Saturday.

The benchmark Korea Composite Stock Price Index (KOSPI) closed at 1,970.61 on Friday, down 0.19 percent from a week ago.

The index rose in four out of five sessions, but it posted a weekly loss due to Friday's selloff ahead of the Italian referendum on a constitutional change slated for Sunday. 

The local market got a boost from sharp gains in Samsung Electronics earlier in the week as hopes for its shareholder-friendly policies drove up its shares to an all-time high. The top market cap's share rose 2.98 percent this week. 

Oil prices soared to lift the market sentiment after the Organization of the Petroleum Exporting Countries (OECD) on Wednesday agreed on its first output cut since 2008, but its rally was shortlived as attention soon shifted to how it will implement the deal.

Tech, manufacturing and chemical stocks were top gainers, while bio, electric utility and logistics underperformed the market. 

Analysts said investors will remain cautious ahead of major events in Europe, while trying to figure out implications from the incoming US administration's policy plans and OPEC's agreement on production cuts. 

"The local equity market is expected to move in a narrow range as investors will take a wait-and-see approach between rising political uncertainties in Italy and hopes for the European Central Bank's stimulus measures," Kim Byung-yeon, an analyst at NH Investment & Securities, said. 

"There is not much upward momentum in the short term as the US Federal Reserve is widely believed to raise the interest rate in the upcoming meeting," he added.

Investors will tune in to the meeting of the European Central Bank on Dec. 8, which will decide whether to extend its bond-buying program, the centerpiece of its stimulus policy.

The Organization for Economic Cooperation and Development releases the composite leading indicator, its monthly economic outlook, for its 34 members on the same day.

On Dec. 9, China will announce its manufacturing and consumer price data for November, and the U.S. will report the consumer sentiment index for December. (Yonhap)