S. Korean shares likely to face correction next week

SEOUL, May 16 (Yonhap) -- South Korea's stock market is expected to face downward
pressure next week as investors lock in gains after two months of rises with no
clear catalyst to pump the market higher, analysts said Saturday.
"The rally on the Seoul bourse has hit a lull now that first-quarter earnings
reports have been released," said Kim Choong-hyun, an analyst at Goodmorning
Shinhan Securities.
"What will get us to the next level is more upbeat data. For a while, the market
will swayed by monthly economic data."
Led by bargain hunting of big-cap shares by investors, the KOSPI, the country's
key stock index, gained 10.78 points or 0.78 percent to close at 1,391.73 on
Friday.
Analysts said trading is likely to go through a correction as investors are
skeptical about the rally that boosted the key stock indicator about 40 percent
during last two months.
"For a couple of sessions last week, foreign investors turned net sellers on news
that consumer sales in the U.S. were lower than expected," said Sung Jin-kyung,
an analyst at Daeshin Investment & Securities. "Foreigners are expected to sell
further."
The U.S. stock market dropped Friday, led by financial stocks sliding on worries
that the economic recovery could be further off than traders had expected in
recent months.
The Dow Jones Industrial Average closed Friday down 0.8 percent at 8,268.64, and
the Nasdaq composite index fell 9.07, or 0.5 percent, to 1,680.14.
But some analysts said that over the long-term, upward movement will continue on
the Seoul bourse as expectations are growing that the Korean economy, Asia's
fourth-largest, may be gaining enough momentum to reverse what threatened to be
the worst downturn in more than a decade.
South Korea's top economic policymaker, Yoon Jeung-hyun, said Friday South
Korea's economy is expected to rebound faster than other countries' as major
indicators are showings signs of improvement.
ygkim@yna.co.kr
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