Seoul shares extend gain

Seoul shares reversed earlier losses to end 1 percent higher on Monday as stronger than expected GDP data lifted sentiment and fuelled foreign buying appetite, with auto and retail issues leading gains. Gross domestic product data confirmed that South Korea's economic fundamentals have improved somewhat, encouraging foreign buying, said Lee Kyung-soo, a market analyst at Shinyoung Securities.
"However we will have to wait and see how the Bank of Korea interprets the data. If a rate hike comes faster than expected, it could be negative to markets," Lee added. The Bank of Korea said the economy grew a seasonally adjusted 2.9 percent in the third quarter from the second quarter, the fastest in 7-1/2 years and a third consecutive quarterly gain.
The Korea Composite Stock Price Index (KOSPI) finished up 1.03 percent at 1,657.11 points. Gains were fuelled by auto and retail issues after the strong data stoked hopes about a recovery in domestic consumption. Shares in Hyundai Motor, South Korea's top automaker, rose 4.11 percent and Kia Motors went up 1.91 percent. Lotte Shopping Co Ltd, South Korea's No 2 retailer by market value, climbed 1.56 percent and Shinsegae Co Ltd advanced 3.22 percent.
Shares in Green Cross jumped 14.73 percent helped by news the US Food and Drug Administration had granted emergency use authorisation to an experimental new influenza drug called peramivir, which a company spokesman confirmed Green Cross had the sole domestic licence to manufacture and distribute. But shipbuilders fell as worries about the industry persisted, with Hyundai Heavy Industries losing 1.36 percent and Daewoo Shipbuilding & Marine Engineering dropping 2.35 percent.
Shares in Woori Finance Holdings fell 0.59 percent, underperforming its peers, after a local media report that Korea Deposit Insurance Corp, a majority shareholder of Woori Finance, was considering selling part of its stake in the financial group in a block trade by mid-November. "Such plans have been known already, but the timing of the block deal has been mentioned in this report, and it has renewed overhang worries," said Hwang Huhn, an analyst at Woori Investment & Securities.
Hana Financial Group, however, rose 4.85 percent, after South Korea's No 4 banking group announced on Friday a swing to quarterly profit. "Strong third quarter numbers are helping (Hana) shares today. Fourth quarter figures may not be as good, but should not be problematic," said Park Jung-hyun, an analyst at Hanwha Securities.