The South Korea stock market has finished higher now in two straight sessions, rising almost 35 points or 1.7 percent in the process. The KOSPI finished just below the 2,050-point plateau, and now analysts are forecasting a mild easing at the opening of trade on Wednesday.
The global forecast for the Asian markets suggests modest consolidation following disappointing economic news from Europe and the United States. The deficit situation in Spain is a growing concern as public debt is expected to reach 78.9 percent of GDP in 2012. In addition, the minutes of the U.S. FOMC's March meeting seemed to indicate that the members were less willing to initiate another round of quantitative easing. The European and U.S. markets finished firmly in the red, and the Asian markets are expected to follow suit.
The KOSPI finished sharply higher on Tuesday following gains from the automobile producers, shipbuilders and technology stocks.
For the day, the index jumped 19.99 points or 0.99 percent to finish at 2,049.28 after trading between 2,038.52 and 2,051.80. Volume was 587 million shares worth 5.99 trillion won. There were 518 gainers and 302 decliners.
Among the gainers, Samsung Electronics jumped 2.77 percent, while SK Hynix climbed 3.24 percent, Hyundai Motor surged 6.25 percent, Kia Motors spiked 3.43 percent, Hyundai Mobis added 1.37 percent, Hyundai Heavy Industries collected 2.18 percent and Samsung Heavy Industries gathered 2.35 percent.
The lead from Wall Street is negative as stocks moved lower on Tuesday, with considerable selling pressure emerging in afternoon trading following the release of the minutes of the Federal Reserve's latest monetary policy meeting.
The minutes of the Fed's March meeting seemed to indicate that the members were less willing to initiate another round of quantitative easing amid signs of improvement in the U.S. economy. The latest minutes said only "a couple of members" indicated that additional stimulus could become necessary, compared to the minutes of the January meeting, which said "a few members" believed that conditions could warrant additional securities purchases.
Also, the Commerce Department reported that factory orders rebounded by slightly less than expected in February. New orders for manufactured goods rose 1.3 percent in February following a 1.1 percent drop in January. Economists had expected an increase of 1.5 percent.
Traders also digested the release of monthly sales results from the nation's major auto manufacturers, with sales rising due in part to increased demand for smaller cars amid the recent surge in gas prices. Chrysler reported a 34 percent jump in auto sales in March, while General Motors (GM) said its sales rose by 12 percent and Ford (F) said its sales increased by 5 percent.
Meanwhile, Molson Coors Brewing (TAP) fell by 5.4 percent after the company announced an agreement to acquire European brewer StarBev for approximately $3.5 billion.
The major averages climbed well off their worst levels going into the close but still ended the day in the red. The Dow fell 64.94 points or 0.5 percent to finish at 13,199.55, while the NASDAQ edged down 6.13 points or 0.2 percent to end at 3,113.57 and the S&P 500 slid 5.73 points or 0.4 percent to 1,413.31.
In economic news, South Korea's official reserves rose to a record high in March driven by an increase in investment profits, the Bank of Korea said on Tuesday. Official foreign reserves totaled $315.95 billion, up $0.15 billion in February. Securities fell by $4.91 billion to $284.59 billion in March and SDRs dropped slightly to $3.54 billion.
Meanwhile, deposits rose $5.02 billion to $22.99 billion. The country's IMF reserve position totaled $2.66 billion, up $60 million. Gold remained unchanged at $2.17 billion. As of the end of February, Korea's foreign reserve holdings remained the seventh largest in the world.
by RTT Staff Writer
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