Seoul bourse to gain momentum in Jan.

SEOUL, Jan. 3 (Yonhap) -- The South Korean stock market is forecast to gain
ground in January with its key index surpassing the previous highest level on a
global economic recovery and strong earnings reports, analysts said Sunday.
The Seoul bourse is widely expected to maintain its upward trend into January
with the benchmark Korea Composite Stock Price Index (KOSPI) likely to top the
1,720 point mark, according to estimates by six local major securities firms.
They said the KOSPI is widely forecast to trade in the 1,720-1,760 level this
month on the back of rising optimism about the global economic recovery and brisk
corporate earnings results.
The KOSPI reached a yearly high of 1,718.88 on Sept. 22, 2009 and finished last
year at 1,682.77.
"Korean companies' fourth-quarter bottom line will not likely be worse than
expected as the global economy is picking up, while oil prices and the local
currency have stabilized," said Choi Jae-sik, an analyst at Daishin Securities
Co.
The KOSPI rose nearly 50 percent in 2009 from a year earlier thanks to a buying
spree by foreign investors, who picked up a net 32.2 trillion won (US$27.8
billion) worth of stocks listed on the main bourse, the highest amount on record.
According to an estimate by SK Securities Co., combined operating profits for the
200 largest local companies in terms of market capitalization likely reached 20.2
trillion won in the final quarter of last year, down a mere 1.2 percent from the
previous quarter. In the first quarter of this year, profits are likely to grow
6.9 percent on-quarter to 21.6 trillion won, it added.
But some analysts struck a cautious note, saying that the KOSPI's growth is
likely to be limited in January because of the Seoul bourse's sharp rise at
year-end.
"As the KOSPI gained ground sharply at the end of last year, the temptation among
investors to take profits will increase," said Park Hyo-jin, an analyst at
Shinhan Investment Corp.
sooyeon@yna.co.kr
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