* KOSPI eyes 7th day of rise, longest streak in 2-1/2 yrs
* Won on track to snap winning streak
By Jungmin Jang
SEOUL, April 3 South Korean shares rose to
three-month highs on Thursday morning, encouraged by news of
stimulus steps from China to bolster growth and on solid U.S.
data, though the won slipped on the back of a well-bid
China acted for the first time this year to steady its
sagging economy by cutting taxes for small firms, providing much
needed relief to global markets worried about a deepening
slowdown in Asia's economic powerhouse.
Adding to the improved mood, data in the U.S. showed
companies stepped up hiring in March for a second straight
The Korea Composite Stock Price Index (KOSPI), which
has been partly supported in recent sessions on the China
stimulus hopes, was up 0.3 percent at 2,003.23 points as of 0231
GMT. It earlier reached a high of 2,007.88, the highest level
since Jan. 2.
The gains kept the KOSPI on track for a seventh-straight
winning session, its longest since an eight day streak in
"The market has been moving in line with regional markets on
cheap valuation as global macro-economic condition continues to
improve, but for a longer-term rise, it needs to demonstrate its
profitability," said Hana Daetoo Securities analyst Chang
Chang was referring to the upcoming corporate earnings
results for the January-March quarter, which analysts say could
determine the short-term outlook for the KOSPI.
Traders also say the market could be ripe for a correction
as the main index has moved deep into "overbought" territory.
Its 14-day relative strength index stood at 77.7, above the
70-mark which is deemed overbought and often points to a
Foreign investors purchased a net 147.6 billion won ($139.7
million) worth of KOSPI shares near mid-session, and headed for
a seventh straight session of net buying. Foreign net inflow
totaled more than 1.5 trillion won during this period,
Market heavyweights Samsung Electronics Co Ltd
and LG Display Co Ltd benefited from the foreign
buying spree, advancing 2.3 percent and 3.2 percent,
STX Heavy Industries Co Ltd bucked the broad
market by tumbling 7.3 percent, after stock market operator
Korea Exchange asked the company to clarify by 0900 GMT media
reports of allegations of embezzlement and breach of trust
against its former CEO.
Decliners outnumbered advancers 434 to 341.
The KOSPI 200 benchmark of core stocks was up 0.4
percent, while the tech-heavy junior KOSDAQ edged 0.3
In the foreign exchange market, the won eased after the
upbeat U.S. private jobs data spurred the dollar, prompting
investors to cover recent short positions.
Dealers, however, believe the won could turn around before
the close of trading.
"The dollar-long bids seem to be the general thought, but
there are uncertainties surround supply and demand," a foreign
bank dealer said. "Should dollar selling by exporters or selling
related to local stocks flow occur, the direction of dollar-won
movement could change in the afternoon."
The local currency was quoted at 1,058.1 against
the dollar near mid-day, down 0.1 percent from Wednesday's close
of 1,056.6. The won has risen 2.1 percent during its six-session
Fixed income assets tracked weakness in the U.S. Treasuries,
with June futures on three-year treasury bonds ticking
down 0.06 points at 105.63 on offshore selling.
0231 GMT Prev close
Dollar/won 1,058.1 1,056.6
Yen/won 10.1790/838 10.1752
*KTB futures 105.63 105.69
KOSPI 2,003.23 1,997.25
* Front-month futures on three-year treasury bonds
($1 = 1056.5500 Korean Won)
(Additional Reporting by KyoungHo Lee)