(LEAD) Seoul stocks shot up 1.13 pct on steelmakers, financials

(ATTN: ADDS bond yields at bottom)
By Park Bo-ram
SEOUL, Sept. 15 (Yonhap) -- South Korea's stock market rallied 1.13 percent on
Tuesday to a yearly high, boosted by gains in steelmakers and financial shares,
analysts said.

The benchmark Korea Composite Stock Price Index (KOSPI) advanced 18.49 points to
a new yearly high at 1,653.4. Volume was moderate at 500.65 million shares worth
6.99 trillion won (US$5.4 billion) with gainers outpacing losers 456 to 348.
"The bullish run was led by financial shares as investors bet on their strong
third-quarter earnings stemming from improving net interest margins," said Lee
Sun-yup, an analyst at Shinhan Investment.
"The local currency's uptrend also boosted importers like steelmakers," Lee said.
No. 3 financial firm Shinhan Financial Group surged 4.46 percent to 48,050 won
and Korea Exchange Bank, controlled by U.S. buyout fund Lone Star, shot up 6.1
percent to 13,050 won.
Top steelmaker POSCO jumped 3.21 percent to 499,000 won with smaller rival
Hyundai Steel increasing 3.78 percent to 82,400 won on expectations a stronger
won will drive down costs of imported raw materials.
LG Chem advanced 9.22 percent to 231,000 won on reports that European auto giant
Volkswagen is reviewing a contract to use the chemical firm's car batteries.
Auto giant Hyundai Motor gained 3.33 percent to 108,500 won after Bank of America
Merrill Lynch raise its target price for the carmaker, citing upbeat global
sales.
The South Korean won ended at 1,218.5 won to the U.S. dollar, up 6.6 won from
Monday's close. Solid foreign stock buying boosted demand for the won, and global
downturn of the dollar also bolstered the currency, dealers said.
Bond prices, which move inversely to yields, closed higher. The return on
three-year Treasuries fell 0.02 percentage point to 4.47 percent and the
benchmark yield on five-year government bonds also shed 0.03 percentage point to
end at 4.93 percent.
pbr@yna.co.kr
(END)