(Updates to mid-morning)
By Park Jung-youn
SEOUL, July 18 (Reuters) - Seoul shares traded slightly
higher on Friday, supported by falling oil prices, but the market
trimmed its earlier 1 percent gains over worries about the health
of U.S. banks on their latest set of mixed results.
The Korea Composite Stock Price Index was up 0.23
percent to 1,529.07 points as of 0138 GMT, but down from the
session's earlier high of 1,542.91.
"Easier oil helped the market eke out gains as oil prices
have been the major concern of South Korean companies and the
economy at large," said Kim Joon-kie, a market analyst at SK
Securities.
However worries over U.S. credit markets trimmed the market's
earlier rally, as larger than expected quarterly losses from
Merrill Lynch MER.N announced after the U.S. market's closing
bell revived concerns about U.S. banks and quashed optimism over
JPMorgan's (JPM.N) healthy earnings.
"Investors remain cautious as results from other banks such
as Citigroup are set to come out soon," said Kim Seung-han, a
market analyst at CJ Investment & Securities.
Analysts also said other negatives surrounding the domestic
market, such as volatility in foreign exchange rates, were seen
as a major risk by investors.
Foreigners were net-sellers for a 30th consecutive session on
Friday, selling 86 billion won ($83.76 million) worth of shares
as of 0138 GMT.
Airlines such as Korean Air Line (003490.KS) rose after U.S.
crude CLc1 lost $5 to settle at around $129 a barrel on
Thursday, easing inflation worries and sending U.S. shares
sharply higher on the day.
Shares in Korean Air Line, South Korea's top air carrier,
climbed 1.38 percent to 44,100 won, and Asiana Airlines
(020560.KS) went up 1.54 percent to 4,960 won.
Financials such as Kookmin Bank 060000.KS and Woori Finance
Holdings (053000.KS) rose after their latest sharp falls, with
Kookmin up 2.1 parent to 53,600 won and Woori Finance Holdings up
1.1 percent to 13,750 won.
However South Korean steelmakers fell across the board after
U.S. peer Nucor Corp's (NUE) weaker-than-expected third quarter
outlook sent U.S. steel shares sharply lower on Thursday. Nucor
lost 11 percent.
"Despite Nucor's strong earnings results, its weak forecast
prompted a selloff in U.S. steelmakers," said Kim Hyun-tae, an
analyst at Goodmorning Shinhan Securities.
"Some negative news flows about POSCO's difficulties in
establishing its India manufacturing unit added to the downward
pressure," Kim added.
POSCO (005490.KS) fell 3.43 percent to 492,500 won and
Hyundai Steel (004020.KS) lost 2.54 percent to 69,200 won.
Meanwhile shares in Korea Gas Corp (KOGAS) (036460.KS) and
Korea Electric Power Corp (KEPCO) (015760.KS) fell on local media
reports that the government cancelled plans to privatise the
state-run energy firms.
KOGAS was down 3.97 percent to 70,200 won and KEPCO was flat
at 29,300 won.
($1=1026.7 Won)
