Seoul shares edged up on Monday to their highest close in nine months, led by retail and financial stocks such as Kookmin Bank amid hopes government plans to revive weak domestic demand would bolster flagging economic growth. A spike in crude oil prices bolstered sentiment for refiners such as SK Corp, but trading was cautious ahead of quarterly results from LG.Philips LCD.
The benchmark Korea Composite Stock Price Index (KOSPI) rose 0.38 percent to close at 923.11, its highest finish since ending at 936.06 on April 23 last year.
"Market expectations for a recovery in consumer demand have gotten stronger," said Kim Jeong-pyo, an equity strategist at Kyobo Securities.
Top local lender Kookmin Bank rose 2.46 percent to end at 43,650 won, fanned by hopes a possible recovery in domestic demand would boost earnings and on news it had been advised to cut 17 percent of its workforce as part of a streamlining plan.
Analysts said local media reports of a pick-up in January sales at local department stores, coupled with a surge in credit card purchases during the fourth-quarter, bolstered sentiment.
Recent government pledges to target 5 percent economic growth this year also helped financial and retail shares, they added.
Hyundai Department Store, South Korea's second-biggest department store chain behind unlisted Lotte Department Store, climbed 4.93 percent to end at 38,300 won.
South Korea's leading brokerage Samsung Securities Co rose 3.45 percent to end at 26,950 won.
Oil refiners also rose after US crude futures climbed 2.6 percent to $48.53 a barrel on Friday. Oil was trading at $49.16 late in Asia.
SK Corp, South Korea's top oil refiner, rose 3.7 percent to close at 56,000 won.
Shares in LG Electronics Inc rose 2.38 percent to 73,200 won after it said it agreed with Nortel Networks Corp of Canada to set up a telecoms equipment venture in South Korea, and ahead of its quarterly results due on Tuesday.
Meanwhile, LG.Philips LCD Co Ltd, the world's second-biggest maker of flat panels, reported a sharp fall in quarterly profits after the market closed.
LG.Philips LCD posted a net profit of 35 billion won for the fourth quarter to December 31, versus a profit of 544 billion won a year ago, but better than analysts' expectations for a 13.3 billion won loss.
Shares in LG.Philips LCD ended 0.22 percent higher at 45,000 won.
South Korea's junior Kosdaq index rose 2.63 percent to close at 472.75, its highest finish since ending at 478.70 on April 28 last year.
Trade volume reached 527 million shares worth 2.4 trillion won compared to 463.5 million shares worth 2.3 trillion won on Friday. Gainers edged out losers by 442 to 299 with 73 titles ending flat.
Foreign investors bought a net of 123.6 billion won in shares on the main bourse, while retail investors sold a net of 40.1 billion won. Institutional investors sold a net of 80.7 billion won.
The March KOSPI 200 futures index fell 0.20 point to 119.95 and the underlying KOSPI 200 spot index rose 0.43 point to 119.83.
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