Seoul shares up on 2007 outlook; blue chips gain


(Updates to mid-morning)

SEOUL, Dec 28 (Reuters) - South Korean shares rose 0.6 percent on Thursday, helped by gains in blue chips such as Samsung Electronics Co. Ltd. on a bright outlook for next year and tracking higher U.S. stocks.

But investors were reluctant to buy shares aggressively as the day is the last day of 2006 and as they still saw some risks including a possible interest rate increase in Japan next year.

The benchmark KOSPI rose 0.55 percent to 1,432.9 at 0137 GMT.

Seoul stock market will be closed on Friday and reopen on Jan. 2.

"South Korean shares lagged other markets this year, but many foreign investors are seen taking out money from India and Thailand and coming back to South Korea," said Joseph Han, an Analyst at Daewoo Securities, who expects the KOSPI to rise as high as 1,700 in 2007.

"IT and financial sectors are expected to show earnings improvement in the first quarter of the next year and Asia's third-largest economy will hit bottom in the quarter," he added.

Samsung Electronics, the world's top memory chip maker, gained 0.65 percent to 616,000 won and its smaller rival Hynix Semiconductor also rose 1.38 percent to 36,750 won.

Kookmin Bank , South Korea's top lender, advanced 0.4 percent to 74,900 won.

Hyundai Motor Co. , the world's No.6 auto maker by sales volume along with its affiliate Kia Motors Corp. , rose 0.15 percent to 67,400 won.

On Wednesday in New York, Ford Motor Co. hit a three-week high on hopes that a meeting between its CEO and the chairman of Toyota Motor Corp. would eventually lead to cost-savings.

But some retailers, such as Shinsegae Co. , fell, amid lingering worries over weakness in domestic demand.

Shinsegae, South Korea's biggest discount store operator, dropped 0.86 percent to 575,000 won and Hyundai Department Store Co. Ltd. declined 0.71 percent to 84,000 won.

"If a bubble in property prices bursts like what happened in Japan, domestic demand will get much worse," said Choo Hee-yeop, a deputy manager of asset management strategy department at Korea Investment and Securities.

On the local economic front, South Korea's current account surplus quadrupled to its biggest in nearly two years in November on robust exports, the central bank data showed on Thursday.



Follow Us

Sponsored Introduction Continue on to (or wait seconds) ×