Seoul shares rebound on upbeat U.S. factory activity, Samsung Elec jumps

Thu Feb 20, 2014 10:19pm EST

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* U.S. factory activity growth hits near 4-yr high

* KOSPI rebounds after two days of losses

By Christine Kim

SEOUL, Feb 21 (Reuters) - Seoul shares rebounded strongly on Friday morning as foreign buying picked up after a survey showed brisk U.S. factory activity, with Samsung Electronics rallying ahead of the launch of its latest smartphone.

The upbeat U.S. manufacturing survey was particularly comforting as it came after a grim reading on China's factory sector raised fresh concerns about growth in the world's second-largest economy.

Markit's preliminary U.S. Manufacturing Purchasing Managers Index rose to 56.7 in February, marking the highest level since May 2010, giving Wall Street a boost and spurring interest in risky assets.

In Seoul, bellwether Samsung Electronics Co Ltd jumped 3 percent ahead of the unveiling on Monday of its latest smartphone, the Galaxy S5.

The Korea Composite Stock Price Index (KOSPI) was up 1.2 percent at 1,952.90 points as of 0314 GMT, poised to score its first winning session after two straight days of losses.

Some traders cautioned that the China worries could yet undermine the KOSPI.

"The U.S. factory survey provided a lift, but the effect may dissipate quickly on underlying China worries," said Ko Seung-hee, a market analyst at SK Securities.

"Since last year the local market has shown a tendency to decouple from developed markets including the U.S., reflecting the rising influence of the Chinese economy."

Foreign interest underpinned the morning session, led by net purchases of 190.2 billion won ($177.39 million) worth of South Korean stocks. It snapped three days of net selling.

Naver Corp recovered some of its previous session losses when the stock tumbled 8 percent as investors worried that Facebook Inc's acquisition of WhatsApp will hurt its own messaging chat service LINE. The stock rose 2.8 percent.

Winners outnumbered losers 457 to 315.

The KOSPI 200 benchmark of core stocks was up 1.3 percent, while the junior KOSDAQ edged 0.4 percent higher. ($1 = 1072.2000 Korean won) (Additional reporting by Jungmin Jang; Editing by Shri Navaratnam)

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