Seoul bourse likely to undergo correction next week: analysts

SEOUL, May 23 (Yonhap) -- The South Korean stock market is expected to lose
ground next week as Wall Street may face volatility due to lingering woes over
the U.S. housing market, analysts said Saturday.
The benchmark Korea Composite Stock Price Index (KOSPI) closed this week at
1,403.75, up 0.86 percent from the previous week.
The local stock market rose to a yearly high of 1,435.7 on Wednesday after
foreign investors went on a buying spree. But the Seoul bourse underwent a brief
correction in the last two sessions of this week as U.S. stock markets retreated
after global credit appraiser Standard & Poor's cut its credit rating outlook for
Britain.
South Korea's decision to lift a ban on short-selling of non-financial stocks
also sent the KOSPI lower.
Analysts said the Korean market is forecast to lose ground next week as
lackluster data over the U.S. housing market will likely weigh on global equity
markets, amplifying possible volatility.
"Lingering uncertainty over a recovery of the global economy will likely burden
U.S. markets," said Kim Joong-hyun, a market analyst at Goodmorning Shinhan
Securities Co. "As the KOSPI has also sharply gained in a short period of time,
the possibility of a market correction is rising."
Lee Seung-woo, an analyst at Daewoo Securities Co., cast a similar view, saying
that the Seoul bourse does not have enough short-term momentum for a further
upswing.
sooyeon@yna.co.kr
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