All, if you are a value investor, this is the time to get into Korea. Here is the news and Good luck for all.
Share Prices Soar 7.7 Percent; Won Rallies Against Dollar
By Koo Hee-jin Staff reporter
Share prices rocketed a record 7.7 percent yesterday, in the belief that stability would reign over the market in the wake of the ''satisfactory'' debt-repackaging accord, dealers said.
The composite price index shot up 39.69 points to close at 558.33, the highest level in three months. It also the highest single-day percentage gain since Dec. 15, 1997, when the bourse recorded a 7.22-percent rise.
Turnover was tepid with only 61.28 million shares worth 727.46 billion won ($464.53 million) changing hands.
The outcome of the roll-over negotiations also helped the local currency to tally against the U.S. dollar, with mid-afternoon won was trading at 1,566 against the dollar, firming up 7.23 percent from the previous closing of 1,688.
''The fact that Korea was able to reach an agreement with its overseas creditors on commercial banks' short-term debts has brought tremendous relief to local financial markets as a whole,'' said a currency dealer at Korea Exchange Bank.
Money market rates also shed a whopping 2.5 percentage points to 18.7 percent, dropping below the 20 percent level for the first time in nearly two months.
As if to make up for the three-day halt in trading due to the lunar New Year holidays, the composite price index zoomed more than 38 points with the opening bell, easily recapturing the 550-point level.
The Korea Stock Exchange was inundated with a flood of buying orders from both local and foreign investors. The rally was mostly concentrated on large-cap issues, as well as banks, which had been excluded from the previous rally which began at the end of last month, traders said.
The rally then spread across the board, prompting most issues to rise to their daily permissible highs. A whopping 792 issues, or 87 percent of the total amount of listed stocks, hit their daily permissible highs.
Even the rumors of a possible court mediation for Samyang Food and of a possible bankruptcy of First Technology failed to dampen the explosive rally.
After the initial rally in the market at the beginning of this month, investors had been keeping a wary eye on the negotiations in New York. With a successful conclusion to the talks, investors are hopeful of a gradual but certain recovery of the Korean economy,'' said Park Won-kyu, senior trader at Daewoo Securities Co.
Market observers projected the index to rise further, noting that the investment climate is prompting both and local and foreign investors to buy more in the market. The pointed out that the so-called ''Big Deal'' under consideration among large conglomerates were giving rise to possible merger and acquisition (M&A) theories in the market. |
