Seoul shares ended flat on Thursday after volatile trade, with automakers such as Hyundai Motor retreating following strong gains, but rises by banking issues lent the market support. The Korea Composite Stock Price Index (KOSPI) finished up 0.02 percent at 1,613.53 points.
"Caution has prevailed ahead of US employment data coming out later this week, and foreign investors turning net sellers is also pressuring markets," said Kim Young-june, a market analyst at SK Securities. Automakers retreated following their recent rally, with Hyundai Motor falling 6.09 percent after hitting its historical high in the previous session, and Kia Motors shedding 4.16 percent.
But banking issues rose, helped by Fitch upgrading its ratings outlook on South Korea. Woori Finance Holdings led banking issues' gains, jumping 8.53 percent, after the company said on Thursday it was considering investing in Blackstone Group's private equity fund at the US group's request.
KB Financial Group rose 3.97 percent and Hana Financial Group also gained 9.05 percent. Meanwhile shares in internet portal operator Daum Communications gained 2.55 percent on expectations that its search-related advertising sales would rise thanks to its growing market share. Analysts said investors were watching Daum's search ad agency contracts, including a contract with Google Korea expected to expire by the end of the year.
"Daum is holding the upper hand in negotiations because its market share has steadily been climbing to around 24 percent, from 12 percent in 2006," said Hwang Seung-taek, an analyst at Hana Daetoo Securities. Strengthening economic hopes following positive US data sent domestic retail issues higher, boosting Lotte Shopping by 1.89 percent and Shinsegae Co Ltd by 1.56 percent. Domestic institutions bought a net 32.7 billion won worth of stocks and retail investors bought a net 112.7 billion won. Foreign investors were sellers of a net 148 billion won worth of stocks.
Decliners led advancers 417 to 385, with 76 counters ending flat. A total of 485 million shares worth 6.9 trillion won changed hands, compared with 554.3 million shares worth 7.9 trillion won traded on Wednesday. The KOSPI 200 September futures index rose 0.90 points to 211.40, while the KOSPI 200 spot index ended up 0.09 points at 210.60. The junior Kosdaq market retreated 0.15 percent to 516.95 points.