(Updates to mid-morning)
SEOUL, May 16 (Reuters) - Seoul shares traded higher
on Friday, extending their rally to hit a new 2008 peak on gains
in Wall Street overnight and softer oil prices, but tech giant LG
Display sank after an analyst downgrade.
The Korea Composite Stock Price Index was up 0.39 percent at
1,893.00 points as of 0124 GMT, once gaining as much as 0.7
percent to fully recoup the year's earlier losses of 19 percent
to its mid-March low.
The KOSPI session high of 1,899.57 points took the index
above 2007's closing of 1,897.13 for the first time this year.
"Stronger than expected earnings from Wall Street and easing
worries about the credit crisis are fueling the market's upward
momentum," said Won Jong-hyuk, a market analyst at SK Securities.
"The index could hit its historical high of 2,085 again by
the second half of this year. But we are likely to see some
volatile patches along the way," Won added.
However losses in some technology shares such as LG Display
(034220.KS) limited the index's upward momentum, with shares in
South Korea's No. 2 flat panel maker shedding as much as 6.62
percent after a rating downgrade by Lehman Brothers. LG Display
fell 5.24 percent to 47,950 won.
Lehman said in a report on Thursday that LG Display's
profitability hit its peak in the first quarter and would not
improve for the rest of 2008.
Other local technology bellwethers such as Samsung
Electronics (005930.KS) and LG Electronics (066570.KS) also
struggled after they hit historical highs in the previous
session, with Samsung down 1.18 percent to 755,000 won and LG
Elec flat at 164,000 won.
Hynix Semiconductor (000660.KS) was an exception, advancing
0.99 percent to 30,700 won after the U.S. index of semiconductor
shares .SOXX rose 2.1 percent on Thursday.
SHIPBUILDERS GAIN
Shipbuilders rose across the board after their latest
earnings reassured investors about their profitability despite
the rising prices of steel plates.
"Earnings may disappoint from the third quarter when steel
price hikes are reflected, but ship order volume remains solid,"
said Jeon Yong-bum, an analys at Dongbu Securities.
"Steel plate prices will also gradually stabilise, at which
point the shipbuilders will be able to lock in higher profit
margins," Jeon added.
Hyundai Heavy Industries (009540.KS) rose 2.82 percent to
364,000 won and Daewoo Heavy Industries (042660.KS) went up 1.41
percent to 43,200 won.
Shares in oil refiners also rose after oil prices dropped to
as low as $120.75 before recovering to settle at $124.12 per
barrel, easing worries about refining margins.
S-Oil (010950.KS) rose 1.32 percent to 69100 won and SK
Energy (096770.KS) gained 2.68 percent to 115,000 won.
(Reporting by Park Jung-youn; Editing by Jonathan Hopfner)
