Latest news with #CommercialAct
Korea Herald
6 hours ago
- Business
- Korea Herald
Foreign inflow fuels Kospi rally
Foreign investors have poured nearly 4 trillion won ($3 billion) into the nation's benchmark Kospi so far this month, helping to drive a strong bullish run in the local stock market. Offshore investors net purchased shares worth 3.78 trillion won on the Kospi through Tuesday in June, continuing the 1.16 trillion won buying spree that began in May, according to data from the Korea Exchange, the nation's bourse operator. While they net bought shares worth 125 billion won on June 2, the amount surged on June 4, a day after the country's presidential election, to 1.05 trillion won, followed by a 980 billion won net purchase on June 5. On Monday and Tuesday, foreigners net bought shares amounting to 977 billion won and 634 billion won on the Kospi, respectively. The rally pushed the index to close daytime trading at 2871.85 on Tuesday, up 16.08 points or 0.56 percent, from the previous session. During intraday trading, the Kospi surged to as high as 2,885.67, nearing the 52-week high set at 2,896.43 on July 11 last year. The buying momentum has been partly fueled by growing expectations of political stability and reform following President Lee Jae-myung's election victory last week. 'With the inauguration of the Lee Jae-myung administration, expectations for revisions to the Commercial Act and efforts to address the 'Korea Discount' have stimulated foreign investor inflows,' said Lee Kyoung-min, an analyst at Daishin Securities. 'Protection of minority shareholder rights and improvements in corporate governance — longstanding demands from global investors — remain key themes. Foreign investment flows into the Korean stock market have clearly improved against this backdrop of policy-driven optimism and attractive valuations.' Backed by the rally, the Kospi has emerged as the best-performing major stock market worldwide over the past week, outpacing key global indices such as Hong Kong's Hang Seng, Denmark's OMX Copenhagen 25 and Japan's Nikkei 225, according to a list compiled by financial platform While not exhaustive, the list features selected stock indices of significant size and market value. Year-to-date, the Kospi has risen 19.36 percent, ranking as the eighth-best performer globally. It trails Poland's WIG 20 index, the top performer so far this year, which has surged 24.67 percent, placing the Kospi roughly five percentage points behind. Among the indices that function as comprehensive market indices that reflect the overall performance of their respective national stock markets, the Kospi ranked behind only those of Russia, Germany, Austria and Hong Kong. The others, such as the WIG 20, were composed of a limited number of selected large-cap companies.
Korea Herald
13 hours ago
- Business
- Korea Herald
Foreign investors fuel Kospi rally with $2.2b buying spree
Foreign investors have poured roughly 3 trillion won ($2.2 billion) into the nation's benchmark Kospi so far this month, helping to drive a strong bullish run in the local stock market. Offshore investors net purchased shares worth 3.14 trillion won on the Kospi through Monday, continuing the buying spree that began in May, according to data from the Korea Exchange, the nation's bourse operator. In May, foreign investors net bought 1.16 trillion won worth of Kospi shares, turning to buying for the first time since August 2024. The rally continued on Tuesday, with foreign investors purchasing an additional 390 billion won worth of shares on the Kospi as of 2 p.m., pushing the index to 2,867.62 — up 11.85 points, or 0.41 percent, from the previous session. The buying momentum has been partly fueled by growing expectations of political stability and reform following President Lee Jae-myung's election victory last week. 'With the inauguration of the Lee Jae-myung administration, expectations for revisions to the Commercial Act and efforts to address the 'Korea Discount' have stimulated foreign investor inflows,' said Lee Kyoung-min, an analyst at Daishin Securities. 'Protection of minority shareholder rights and improvements in corporate governance — longstanding demands from global investors — remain key themes. Foreign investment flows into the Korean stock market have clearly improved against this backdrop of policy-driven optimism and attractive valuations.' Amid the offshore buying spree, shares of market bellwether Samsung Electronics rose as high as 60,400 won during intraday trading on Monday, surpassing the 60,000 won threshold for the first time since March 28. The stock later pared its gains, trading at 59,250 won as of 2 p.m. Tuesday. The Kospi has emerged as the best-performing major stock market worldwide over the past week, outpacing key global indices such as Hong Kong's Hang Seng, Denmark's OMX Copenhagen 25, and Japan's Nikkei 225, according to a list of major world market indices compiled by financial platform While not exhaustive, the list features selected stock indices of significant size and market value. Year-to-date, the Kospi has risen 19.36 percent, ranking as the eighth-best performer globally. It trails Poland's WIG 20 index — the top performer so far this year — which has surged 24.67 percent, placing the Kospi roughly five percentage points behind.
Korea Herald
6 days ago
- Business
- Korea Herald
Kospi hits 10-month high on hopes for Lee's economic revival
Foreign inflows, stimulus plans drive 10-month high as new president takes office South Korea's stock market climbed to a 10-month high on optimism that newly inaugurated President Lee Jae-myung will act swiftly to revive the country's sluggish economy through aggressive stimulus and market reforms. The benchmark Kospi breached the 2,800 mark on Thursday for the first time since July 2024, extending gains from the previous session. The index jumped more than 2 percent in early trading to an intraday high of 2,831.11 before paring gains to hover near 2,800 as of 2:30 p.m. The rally followed Wednesday's nearly 3 percent surge, which pushed the index to a year-to-date high of 2,770.84. Foreign investors net bought 1 trillion won ($735.4 million) and institutions added 200 billion won, while individuals sold 1.2 trillion won to lock in profits. The buying continued Thursday, with foreigners and institutions snapping up another 670 billion won and 400 billion won, respectively, as retail investors offloaded 1 trillion won more. Markets are responding to Lee's full-throttle policy agenda centered on restoring livelihoods and reigniting growth. 'We will begin by restoring livelihoods and revitalizing the economy,' Lee said Wednesday, launching an emergency economic task force as his first executive order. Among his initial directives was finalizing a supplementary budget. Lee pledged at least 30 trillion won in fresh stimulus to be drafted, following the 13.8 trillion won package approved ahead of the election. Political and market observers expect the proposal to be submitted to parliament next month, with the funds largely targeting public support measures such as local business vouchers to revive domestic demand. Beyond the extra budget, Lee's broader economic strategy hinges on expansive fiscal spending, with 210 trillion won in government funds planned over his five-year term. His agenda includes expanded welfare, support for strategic sectors such as artificial intelligence and efforts to lift long-term growth. Lee aims to lift Korea's annual growth rate to 3 percent, up from the sub-1 percent pace forecast for this year. He also envisions transforming the country into the world's third-largest AI powerhouse and elevating it to the rank of the world's fifth-strongest nation during his presidency. Investor sentiment is also buoyed by Lee's push to strengthen capital markets. On Thursday, the ruling Democratic Party of Korea reintroduced a revised Commercial Act aimed at reinforcing minority shareholder rights — legislation previously shelved under the former administration and now central to Lee's pro-market agenda. The bill proposes sweeping governance reforms, including expanding directors' fiduciary duties to shareholders, renaming outside directors as independent directors, mandating cumulative voting, expanding separate elections for audit committee members, introducing virtual shareholder meetings, and tightening the 3 percent rule that limits major shareholders' voting rights in audit board appointments. To expedite implementation, all provisions will take immediate effect upon promulgation except for electronic voting, which will require system upgrades. The local market is moving to shed the 'Korea Discount' as the new administration accelerates policy implementation, said senior market analyst Lee Kyoung-min of Daishin Securities. 'The push for Commercial Act revisions is fueling a revaluation of underperforming stocks, while expectations for a large-scale supplementary budget are bolstering hopes for a recovery in Korea's deeply frozen economy,' he said, noting that robust foreign inflows are driving the rally. 'Stronger policy expectations are putting upward pressure on the won, creating conditions for a potential pickup in foreign capital inflows,' he added. The Korean won strengthened to an eight-month high against the greenback on Thursday, breaching the 1,350 won-per-dollar level for the first time since October 2024.
New Straits Times
7 days ago
- Business
- New Straits Times
South Korean shares rally on post-election stimulus, reform hopes
SEOUL: South Korean shares climbed on Wednesday to their highest levels in 10 months, as liberal presidential candidate Lee Jae-myung's election victory raised hopes of swift economic stimulus policies and market reforms. The benchmark KOSPI jumped 2.66 per cent to 2,770.84, posting its biggest daily gain in nearly two months and closing at the highest level since August 1, 2024. Lee officially took office as president on Wednesday, just hours after his victory in a snap election the previous day. His swift rise to power ends six months of political turmoil sparked by former President Yoon Suk Yeol's failed attempt to impose martial law in December - a move that stunned the country and rattled financial markets. "The inauguration of the new administration resolved political uncertainty," said Kang Jin-hyeok, an analyst at Shinhan Securities. "And, there are expectations that policy drives could be strong as Lee's Democratic Party holds a majority in parliament," Kang said. Foreign investors snapped up local shares worth 1.05 trillion won (US$766.60 million), marking their biggest single-day purchase since August 16, 2024. Lee has pledged to bring corporate reform measures to boost the domestic stock market, raise investment in artificial intelligence, and revive an economy reeling from slowing growth with stimulus policies. On capital markets, Lee has pledged to revive legislation within a few weeks to curb abuses by controlling shareholders of chaebol conglomerates, as part of his "KOSPI 5,000" pledge to double the value of the domestic stock market. The revision to the Commercial Act is seen by market analysts as a fundamental change needed to resolve the so-called "Korea Discount", a tendency for local shares to be undervalued compared with global peers due to low dividend payouts and opaque corporate governance. The securities sector was the top gainer, rising 8.1 per cent to its highest level since August 2009, while financial groups jumped 6.5 per cent to the highest point since May 2008. Analysts anticipate that these sectors will be among the biggest beneficiaries of ongoing market reform efforts. "We expect to see meaningful progress in capital market and governance reform post-election," Morgan Stanley's analysts said in a note, setting their KOSPI target for June 2026 at 2,800 for the base case and 3,100 for the bullish case. Renewable energy stocks rallied on expectations of a reversal in energy policy away from nuclear energy, with Hanwha Solutions climbing 5.7 per cent and OCI gaining 4.9 per cent, while the construction sector rose nearly 3 per cent on stimulus hopes. With President Lee signaling a more conciliatory approach toward North Korea and China, stocks linked to North Korea, such as In The F and Namkwang Engineering & Construction , as well as China-exposed sectors like beauty and entertainment, saw gains. Among major heavyweights, chipmaker SK Hynix gained 4.8 per cent, while rival Samsung Electronics rose 1.8 per cent, further buoyed by overnight gains among US peers. "A combination of aggressive industrial policies and expansionary fiscal policies could lead to faster economic growth, at least in the short term," said Kim Jin-wook, an economist at Citi. Lee announced plans to draft a second supplementary government budget of at least 30 trillion won to support the trade-reliant economy, which has been hit by US tariffs and is projected to grow by just 0.8 per cent this year. This follows a 13.8 trillion won supplementary budget passed in May. The won strengthened 0.55 per cent to 1,369.5 per dollar on the onshore settlement platform. The country's treasury bond yields rose, with the benchmark 10-year yield gaining 9.3 basis points to 2.894 per cent, the biggest jump since January 13.
Korea Herald
7 days ago
- Business
- Korea Herald
Kospi hits year-high on postelection optimism
South Korea's benchmark Kospi surged to a year-high as of press time on Wednesday, driven by political clarity following President Lee Jae-myung's election victory. The Kospi stood at 2,764.34 as of 2 p.m. Wednesday, marking a gain of 65.3 points, or 2.42 percent, from the previous trading session on Monday. The Korean bourse was closed on Tuesday in observance of the presidential election. The index opened at 2,737.92, trading higher from the outset as bullish sentiment carried over from the premarket hours. It continued to gain momentum throughout the morning session, reaching as high as 2,768.37 during intraday trading. This marks the first time the Kospi has surpassed the 2,760 threshold since August 2024. Foreign and institutional investors were net buyers on the day, purchasing 668 billion won ($486 million) and 441 billion won worth of shares on the benchmark index, respectively. Retail investors were the only net sellers, offloading 1.07 trillion won worth of stocks to lock in profits. Amid the market upturn, bellwether Samsung Electronics rose to 57,550 won, up 1.23 percent as of 2 p.m. Its crosstown rival SK hynix jumped 5.5 percent to 219,000 won. The secondary Kosdaq index stood at 750.42 as of 2 p.m., rising 10.13 points, or 1.37 percent, from the previous session. It opened at 749.13 and touched a day-high of 752.75 during intraday trading before paring some gains. 'In the next two to three weeks, the market will assess the likelihood of President Lee Jae-myung addressing the Korea discount and potentially driving the Kospi toward the 5,000-point milestone, while keeping a close eye on key pledges such as Commercial Act reforms and mandated cancellation of treasury shares,' said Han Ji-young, an analyst at Kiwoom Securities. Though the Korean won was expected to gain strength following Lee's victory, which reduced political uncertainty that had weighed on its valuation, the currency remained largely flat throughout the day as the strengthening US dollar offset its appreciation. The greenback rebounded from a six-week low on Tuesday after recent data reinforced the resilience of the US labor market. As of 2 p.m., the Korean won was quoted at 1,374.03 per dollar, gaining approximately 3 won from the previous trading session. It opened at 1,375.9 per dollar. 'Since all major presidential candidates had emphasized boosting domestic demand, the election outcome was not expected to have a significant impact on the currency exchange path,' said Lee Joo-woon, an economist at Daishin Securities. 'The political uncertainty had already been resolved with the impeachment of former President Yoon Suk Yeol and the scheduling of an early presidential election. 'However, the implementation of policies that had been stalled paves the way for economic recovery, which is expected to support further appreciation of the Korean won.'
