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Rally May Stall For South Korea Stock Market

The South Korea stock market has closed higher now in back-to-back sessions, collecting almost a dozen points or 0.6 percent along the way. The KOSPI finished just below the 2,030-point plateau, although now analysts are forecasting mild consolidation at the opening of trade on Monday.

The global forecast for the Asian markets is fairly light on leads, since the major European and U.S. markets were closed for Good Friday. However, analysts are looking for selling pressure on Monday after U.S. employment data failed to meet expectations.

The KOSPI finished flat on Friday, nudged higher by gains from the oil companies, retailers and technology stocks.

For the day, the index added 0.26 points or 0.01 percent top finish at 2,029.03 after trading between 2,022.81 and 2,033.49.

Among the gainers, Ssangyong Engineering and Construction surged by the 15 percent daily limit, while Hyundai Department Store jumped 3.7 percent, Shinsegae climbed 4.2 percent, SK Innovation collected 1 percent, S-Oil added 0.9 percent, Samsung Electronics gathered 0.2 percent and STX Corp spiked 5.1 percent.

There is no lead from Wall Street or Europe, although the Asian markets are still looking at some negative momentum after the Labor Department reported on Friday that U.S. employment saw continued growth in March, although the pace of job growth came in well below estimates.

Non-farm payroll employment increased by 120,000 jobs in March following an upwardly revised increase of 240,000 jobs in February. Economists had expected the addition of about 201,000 jobs compared to the increase of 227,000 jobs that had been reported for the previous month.

The continued job growth was partly due to notable increases in employment in the leisure and hospitality and manufacturing sectors, which added 39,000 jobs and 37,000 jobs, respectively.

Despite the weaker than expected job growth, the unemployment rate unexpectedly edged down to 8.2 percent in March from 8.3 percent in February. With the unexpected drop, the unemployment rate fell to its lowest level since coming in at 7.8 percent in January of 2009.

Also, the Bank of England kept the size of its bond purchases unchanged, as concerns about a technical recession ease and inflation remains sticky due to elevated oil prices. The nine-member Monetary Policy Committee decided to leave the quantitative easing unchanged at GBP 325 billion. Also, the committee retained the benchmark interest rate at its record low level of 0.50 percent.

In economic news, producer prices in South Korea climbed 0.6 percent on month in March, the Bank of Korea said on Monday, after collecting 0.7 percent in February.

Among the individual components, prices for agriculture, forestry and marine products were up 1.4 percent, while manufacturing industry products were up 0.7 percent, electric power, water and gas prices added 0.4 percent and services costs collected 0.2 percent.

On a yearly basis, PPI was up 2.8 percent following the 3.5 percent jump in the previous month.

by RTT Staff Writer

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