December 8th, 2008 | by admin |
*KOSPI gains 3.2 pct
*Builders rise on hopes for gov't support moves
*Memory chip makers climb on prospect of output cuts
(Updates to midmorning)
By Park Jung-youn
SEOUL, Dec 8 (Reuters) - Seoul shares rose on Monday helpedby gains in Wall Street on Friday, with builders climbing onhopes of further economic stimulus measures by the government andsome techs advancing on expectations of output cuts by rivals.
The Korea Composite Stock Price Index .KS11 was up 3.20percent at 1,061.01 points as of 0143 GMT.
"Although U.S. job data came out quite dismal, investors havegrown somewhat immune to negative economic data, as it has becomequite clear now that we are in a severe economic downturn," saidMin Sang-il, a market analyst at Hanhwa Securities.
"The focus has shifted towards potential moves by governmentsand central banks to boost the economy and financial markets.Expectations are particularly high for the incoming (U.S.President-elect Barack) Obama administration," Min added.
U.S. employers axed payrolls by a shocking 533,000 inNovember, the weakest performance in 34 years, government datashowed on Friday.[ID:nN05444819]
Meanwhile White House and congressional negotiators sought onSunday to remove differences over an emergency rescue for thestruggling U.S. auto industry.[ID:nN07462460]
Regional markets also advanced, with Taiwan's benchmark index.TWII climbing 4.11 percent and the Nikkei .N225 up 2.57percent.
Memory chip makers advanced led by Hynix Semiconductor(000660.KS: Quote, Profile, Research, Stock Buzz), which rose after the company announced plans toslash costs while expectations grow for an industry-wide outputreduction in coming months.
Hynix said on Sunday it would have its employees on unpaidleave for two weeks and take up a voluntary retirement programmeas it seeks to cut labour costs by more than 15 percent.[ID:nSEO335966]
As the world's No. 2 computer memory chip maker takes extrasteps after shutting down its outdated production lines, analystsexpect Hynix's rivals would also implement larger production cutsthat could help the industry recover.
"Taiwanese makers are likely to cut down output sharplyaround the lunar new year holiday. Samsung Electronics(005930.KS: Quote, Profile, Research, Stock Buzz) could reduce production from its 8-inch lines too,"said James Song, an analyst at Daewoo Securities.
Hynix rose 3.57 percent and Samsung Electronics (005930.KS: Quote, Profile, Research, Stock Buzz)went up 3.04 percent.
Meanwhile construction issues were boosted by talk of moreeconomy-stimulating measures by the South Korean government,analysts said.
"Lately we've been seeing continuous news reports aboutpossible income tax cuts and measures to help boost troubledindustrial sectors. Some of these may be made official by thegovernment by tomorrow, which has lifted sentiment towardsbattered construction issues," said Heu Moon-wook, an analyst atSamsung Securities.
Hyundai Engineering and Construction (000720.KS: Quote, Profile, Research, Stock Buzz) rallied 5.62percent and Daewoo Engineering and Construction (047040.KS: Quote, Profile, Research, Stock Buzz)jumped 6.37 percent.
Meanwhile automakers rose for a third consecutive sessionafter the South Korean government pledged on Friday to help thebeleaguered sector, as the government tries to dodge a recessionby reviving demand in Asia's fourth-largesteconomy.[ID:nSEO342138]
Hyundai Motor (005380.KS: Quote, Profile, Research, Stock Buzz) advanced 3.16 percent and KiaMotors (000270.KS: Quote, Profile, Research, Stock Buzz) gained 2.75 percent.
(Editing by Jonathan Hopfner)