Seoul shares rose 0.2 percent on Friday, after moving in and out of positive territory, helped by gains in insurers and banks. But rises were capped by ongoing concerns about reduced monetary stimulus in the United States and a slowdown in the Chinese economy. "Prospect of a US (stimulus) exit made investors anxious, and adding to that was shakiness in the Japan share market, and concerns about China," said Choi Un-sun, a market analyst at LIG Investment & Securities.
Foreign investors were, however, seen returning steadily to South Korean stocks ahead of Vanguard Group's share sale ending next month, and as government measures aimed at boosting the economy took more palpable effect, noted Kim Soon-young, a market analyst at IBK Securities. Roughly 3 trillion won of Vanguard-related foreign share sales are expected through the end of June as it switches the benchmark of its emerging market index fund.
Foreign investors were sellers of a net 86 billion won worth of stocks, offloading shares for a second straight session. Still, the Korea Composite Stock Price Index finished up 0.22 percent at 1,973.45 points. Banks bounced with Woori Finance Holdings seeing a firm 4 percent rise on hopes that efforts to privatise the banking group would go more smoothly after a new group chairman was elected on Thursday. Woori Finance was the second most-active share on the main KOSPI.
"The real estate market warming up following government measures in April is helping banks that are more heavily exposed to the sector," said Joanne Lee, an analyst at Korea Investment & Securities, referring to the banks' loans. South Korea on April 1 unveiled measures aimed at boosting the property market. KB Financial Group rose 1.2 percent and Hana Financial Group climbed 2.6 percent.
Samsung Fire Insurance was up 4 percent and Hyundai Marine & Fire gained 2.1 percent. "Insurers have fairly stable business model," which helped them shine in market where preference for the less-cyclical sectors is growing, said Park Sun-ho, an analyst at Meritz Securities. Crude oil refiners and chemical companies continued to lag after Brent crude oil prices fell to a three-week low in US trade overnight. GS Holdings shed 2.7 percent and SK Chemicals slumped 3.2 percent.