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Kospi notches record high for 2020 amid economic rebound hopes

Buttressed by retail investors’ massive buying, Kosdaq closes at 52-week high

A sign at Hana Bank’s dealing room in Seoul on Tuesday shows the Kospi index hit its yearly high closing of 2,279.97. (Yonhap)
A sign at Hana Bank’s dealing room in Seoul on Tuesday shows the Kospi index hit its yearly high closing of 2,279.97. (Yonhap)

South Korea’s main bourse Kospi on Tuesday hit the highest point over the last year, with retail investors continuing their buying spree for a fifth consecutive session after tracking an overnight Wall Street rally led by economic rebound hopes.

The Kospi opened higher at 2,272.33 -- up 21.29 points, or 0.95 percent, from the previous session. The strong start continued throughout the day to close at 2,279.97, its highest of the year, surpassing 2,267.25 on Jan. 22. The index hit an intraday high of 2,284.66, marking a fresh yearly high after 2,281.41 was seen during trading Friday.

Retail investors net purchased 184.2 billion won ($154.19 million) of stocks, while institutional investors sold 148.3 billion won and foreign investors, who were net buyers in early trading, ended up turning to net sellers and dumped a net 61.4 billion won of local shares.

The tech-heavy Kosdaq began trading at 833.28, up 5.71 points, or 0.69 percent, from the previous session. Buoyed by retail investors’ massive buying, the index moved upward and hit a 52-week high of 835.35 at the closing bell. The Kosdaq rose nearly twice from a 52-week low in less than five months, soaring from 419.55 on March 19.

Retail investors scooped up 155.4 billion won of shares. Both foreigners and institutional, who were net buyers a day earlier, however, sold a combined 126.1 billion won of local stocks on Tuesday’s trading.

Despite the rise in new coronavirus infections around the globe, estimate-beating July manufacturing data in the US, China and Europe raised hopes for a global economic rebound.

The US indexes closed higher amid a rally in tech shares Monday. Nasdaq jumped 1.47 percent to an all-time high, ending trading at 10,902.80. The Dow Jones Industrial Average and the S&P 500 also rose 0.89 percent and 0.72 percent, respectively.

Meanwhile, the local currency closed at 1,194.1 won against the US dollar, down 0.7 won from the previous session’s close. It started trading at 1,192.2 won per dollar and rose to 1,195 won per dollar during trading, before strengthening slightly before closing.

By Jie Ye-eun (yeeun@heraldcorp.com)
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