Seoul shares edge higher on ECB rate cut, Hyundai climbs

Fri May 3, 2013 3:08am EDT

Related Topics

* ECB rate cut lifts sentiment, but upside limited

* Hyundai climbs on overseas plant hopes

By Jungyoun Park

SEOUL, May 3 (Reuters) - Seoul shares edged up on Friday, helped by the European Central Bank's cut in interest rates to an all-time low and a climb in Hyundai Motor Co's shares on hopes that it is planning a new car plant in the United States soon.

The Korea Composite Stock Price Index (KOSPI) finished up 0.4 percent at 1,965.71 points, taking its gains for the week to 1 percent.

"The European Central Bank's rate cut decision is a sign that governments around the world are determined to revive their economies," said Kim Hyoung-ryoul, a market analyst at Kyobo Securities.

Shares in Hyundai Motor and its affiliate Kia Motors rose 2.3 percent and 2.5 percent after Hyundai said it was considering building car manufacturing plants abroad. Climbs in April vehicle sales for both automakers also lifted sentiment.

Hyundai has been held back by stretched U.S. manufacturing capacity. Its chairman, Chung Mong-koo, is due to accompany South Korean President Park Geun-hye on a visit to the United States next week, and some analysts said he might announce plans for a new plant then.

Brokerages were firmer, with Woori Investment & Securities advancing 1.3 percent and Mirae Asset Securities gaining 2.4 percent.

Telecommunication stocks continued to rally as defensive stocks remained in favour. SK Telecom, South Korea's top wireless carrier, rose 3.4 percent. KT advanced 1.4 percent.

Software firm SK C&C shares jumped 5.7 percent after the company reported a 14 percent rise in January-March operating profit from a year earlier as overseas sales climbed.

Local institutional investors bought a net 129 billion won worth of KOSPI shares.

Gainers led decliners, 500 to 302.

The KOSPI 200 benchmark of core stocks finished up 0.4 percent, while the junior KOSDAQ rose 0.9 percent. (Editing by Edwina Gibbs)

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