South Korean stocks will likely continue to gain ground next week as improving U.S. economic indicators are expected to bolster investor sentiment, analysts said Saturday.
The benchmark Korea Composite Stock Price Index (KOSPI) rose about 1.5 percent this week to close at 1,867.22 on Friday. The rise came despite a plunge on Monday caused by news of the death of North Korean leader Kim Jong-il.
Investors were spooked by heightened geopolitical risks, but soon turned their focus more to economic news coming from the U.S. and Europe.
Spain’s larger-than-expected debt sale and improving housing market data in the U.S. helped the index recoup ground lost during the Monday selloff.
Shares rose across the board, with construction and communications sectors posting about 4 percent and 3 percent gains. Banks and machinery, however, ended lower this week.
Eurozone debt problems will keep unsettling investors’ minds but those concerns could subdue somewhat thanks to improved liquidity conditions there after the ECB recently awarded euro-region banks 489 billion euros (US$ 638 billion).
What investors will pay more attention to will be indicators to be announced next week regarding housing markets, employment and manufacturing industries in the U.S., analysts said.