July 16, 2012 / 7:43 AM / 5 years ago

Seoul shares rise on China hopes; eyes on Bernanke, earnings

By Joonhee Yu
    SEOUL, July 16 (Reuters) - Seoul shares rose again on Monday
as worries about Chinese growth further eased, but gains were
capped as investors awaited  cues from U.S. and domestic
corporate earnings and policy hints from the Federal Reserve.
    The Korea Composite Stock Price Index (KOSPI) rose
0.27 percent to close at 1,817.79 points.
    On Friday, when China said its second-quarter growth was 7.6
percent, the Kospi rose 1.5 pct. Over the weekend, Premier Wen
Jiabao pledged to stabilise the economy and step up efforts in
the second-half to increase policy effectiveness. 
-- which aided Monday's gain. 
    On Tuesday and Wednesday, Fed Chairman Ben Bernanke will
deliver his semi-annual testimony to the U.S. Congress on the
state of economy, where he is expected to reiterate the bank's
recent stance that it will undertake more aggressive stimulus
only if there are signs of further slowdown.
     Although worsening global economic conditions are
foreshadowing a lackluster earnings season and pressuring risk
sentiment, analysts say much of the negative expectations have
been priced in. 
    "The earnings bar has gradually fallen to the point that
chances of a negative shock are remote while leaving a very low
hurdle to clear for positive surprises," said Bae Sung-yung, an
analyst at Hyundai Securities.
    Battered petrochemical shares outperformed on bargain
hunting, with SK Chemicals soaring 4 percent while
LG Chem rose 1.7 percent.
    Blue-chips, which were subject to sharp pullbacks on foreign
selling much of last week, extended gains from Friday. Index
heavyweights Samsung Electronics and Hyundai Motor
 each rose 1.1 percent.
    SK Gas Ltd soared 6.3 percent following media
reports that it was entering the market for liquefied petroleum
gas products, citing company officials.
    Hyundai Heavy Industries fell 2.9 percent,
extending losses to a seventh day after local brokerage house
Woori Investment & Securities cut its forecast for the world's
leading shipyard, citing a sharp downturn in its oil refining
subsidiary, Hyundai Oilbank. 
    Trading was choppy, with 2.95 trillion won ($2.6 billion) 
of shares exchanging hands on the main bourse, the thinnest
daily volume in three weeks.
         Move on day                +0.27 percent    
         12-month high   2,192.83   8 July 2011                 
         12-month low    1,644.11   26 Sept 2011                
         Change on yr               -0.43 percent              
         All-time high   2,231.47   27 April 2011               
         All-time low       93.10   6 January 1981 
($1 = 1150.3000 Korean won)

 (Editing by Richard Borsuk)

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