Ahead of Monday's holiday for Buddha's Birthday, the South Korea stock market had finished higher in two straight sessions, gathering almost 25 points or 1.3 percent in the process. The KOSPI finished just shy of the 1,825-point plateau, and now investors are looking for a firm start for the market when it opens on Tuesday.
The global forecast for the Asian markets is cautious with a tight range, as ongoing concerns over European debt are exacerbated by a lack of other impetus since the U.S. markets were closed on Monday for Memorial Day. The Swiss National Bank is considering setting up a task force to draw an emergency plan for dealing with a possible collapse of the euro, though the bank believes such a scenario is highly unlikely. Further, record borrowing costs and bank troubles in Spain continue to suggest that it could possibly be the next nation to seek international financial assistance. The European markets were mixed but little changed, and the Asian bourses are tipped to follow suit.
The KOSPI finished modestly higher on Friday following gains from the technology stocks and steel companies.
For the day, the index collected 9.70 points or 0.53 percent to finish at 1,824.17 after trading between 1,815.54 and 1,831.78. Volume was 379 million shares worth 3.49 trillion won. There were 534 gainers and 293 decliners.
Among the gainers, LG Electronics jumped 0.75 percent, while POSCO added 0.57 percent, LG Chem climbed 4.84 percent, Hyundai Heavy Industries added 1.72 percent and Kia Motors collected 0.66 percent.
There is no lead from Wall Street, although the news from Europe suggests plenty of caution, aside from the ongoing and growing concerns over Greece and Spain.
Italy's borrowing costs increased on Monday as fears over Greece exiting the euro currency. The treasury raised EUR 3.5 billion from new May 2014 zero-coupon bonds, matching the maximum target set for the auction - but the gross yield rose to 4.037 percent. Earlier in April, average yield on a similar 2-year bond was 3.36 percent. The treasury also sold EUR 332.5 million BTP maturing on 2017 and EUR 417.5 million five-year 2016 BTP.
In addition, Italian business confidence fell more than expected to its lowest level since August 2009, the statistical office Istat said on Monday. The business sentiment index dropped to 86.2 in May from 89.1 in April.
The Swiss National Bank is considering setting up a task force to draw an emergency plan for dealing with a possible collapse of the euro, though the bank believes such a scenario is highly unlikely, SNB President Thomas Jordan said Sunday.
One measure being considered is capital controls. Swiss policymakers imposed a ceiling of 1.20 versus euro last September to stem excessive gains in the currency following the worsening of the Eurozone debt crisis. Jordan said that the central bank will continue to enforce the minimum exchange rate even under adverse economic conditions.
The major European markets were mixed on Monday as Germany's DAX was down 16.75 points or 26 percent to finish at 6,323.19. The CAC in France eased 4.97 points or 0.16 percent to end at 3,042.97 and London's FTSE added 4.81 points or 0.09 percent to end at 5,356.34.
by RTT Staff Writer
For comments and feedback: editorial@rttnews.com
Market Analysis