Fluctuating Seoul Bourse
On May 14, the Korea Composite Stock Price Index (KOSPI) hit a record high for this year at 2,010.83 points, which was up 27.9 points, or 1.41 percent, from the previous day.
Foreign investors’ net purchase amounted to close to 343 billion won (US$334 million) on that day and 213.1 billion won (US$207.6 million) on the previous day, a gain of the index. In addition, the won-dollar exchange rate succeeded in making a rebound for at least some stability. The shares of the subsidiaries of the Samsung Group continued their upward movement amid expectations for its ownership structure reform.
Foreign investors had continued their selling streak in the bourse for nine preceding sessions in a row. However, their change in stance, along with purchases by institutional investors, raised the index to over 2,010 points for the first time since December 30 last year, when it hit 2,011.34.
The won, in the meantime, depreciated to some extent to have a positive effect on the stock market. The exchange rate, which had declined rapidly from 1,040 won since April 28, rose 5.8 won per U.S. dollar to close at 1,027.9 won. It is said that the financial authorities bought approximately US$1 billion or so in U.S. dollars during lunchtime and again right before the closing of the session.
Samsung Group shares are expected to contribute to the upward movement for the time being, too. Market participants anticipate that the hospitalization of chairman Lee Kun-hee will result in a reform of the corporate governance systems. Foreign investors’ net purchases of the shares of Samsung Electronics, Samsung Heavy Industries, Samsung C&T, Samsung Life Insurance, and the like reached over 144 billion won (US$140.4 million) on May 13 and 14. Local stock firms are adjusting their forecasts for Samsung Electronics for the better, too.