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South Korean shares rise on China stimulus

Updated: Apr 22,2015 4:14 PM     Xinhua

SEOUL — South Korean shares started the first day of this week in positive terrain on April 20 as investors’ sentiment was bolstered by China’s monetary stimulus over the weekend.

The benchmark Korea Composite Stock Price Index (KOSPI) gained 3.21 points, or 0.15 percent, to 2,146.71 at the close. Trading volume stood at 503.4 million shares worth 6.97 trillion won ($6.46 billion).

The People’s Bank of China (PBOC) said on April 19 that it will lower the reserve requirement ratio (RRR) by 100 basis points to 18.5 percent from April 20 for commercial banks.

Investors’sentiment was boosted as China, South Korea’s biggest trading partner, turned out to be aggressive in stimulating the world’s second-largest economy.

The positive sentiment was offset by renewed worries about the so-called Grexit, or possible exit of Greece from the eurozone economic bloc. Greece and the eurozone are scheduled to talk about bailout funds on April 24.

Amid expectations for ample liquidity in the global market caused by quantitative easing in Europe and the RRR cut in China, foreigners bought a net 285 billion won worth of local stocks, keeping a buying trend for 10 straight sessions.

Retail investors raised stock holdings by 29 billion won, but institutional investors sold stocks worth 312 billion won.

Large-cap shares ended mixed. Top automaker Hyundai Motor advanced 2.7 percent, and Cheil Industries, the de-facto holding company of Samsung Group, climbed 3.2 percent. Market bellwether Samsung Electronics declined 1.4 percent, and memory chip giant SK Hynix slid 0.7 percent.

The South Korean currency finished at 1,079.2 won against the greenback, up 4.5 won from the close on April 17.

Bond prices ended lower. Yields on the liquid three-year Treasury notes rose 0.2 basis points to 1.693 percent, and the return on the benchmark 10-year government bonds gained 3.1 basis point to 2.112 percent.