KOSPI Recovers to 650 Points in Five Months

The Korean Stock Price Index (KOSPI) soared past the 650 mark on Monday for the first time in five months as part of a three day rally. Experts had predicted that the Korean stock market would face a momentary suspension as it is only three days away the `Triple witching day` which marks the simultaneous expiration of stock options, index options and index futures. Predictions were off however, as seen in the numbers.

The KOSPI surged by 7.97 points, or 1.2 percent, to 650.35 on Monday, and the Kosdaq Index also gained 0.93 points, or two percent, to 48.19. Both indexes were at their highest in five months.

Analysts noted that the index rally was largely attributable to foreign investors` aggressive purchases; they net-bought W223.7 billion in the main bourse on a rally of net-purchases for eight days in a row. For the eight-day period, foreigners bought a net total of W1.1 trillion. Organizational investors led the upward rally in the tech-heavy Kosdaq market.

Samsung Electronics jumped by more than 3 percent the same day, peaking at W340,000 a share, a five-month high, while most of the market-leading shares, including POSCO, Hyundai Motor, Korea Electric Power Corp., SK Telecom and KT Corp., also rose sharply.

Meanwhile, stock markets in Asia showed simultaneous rallies with Japan`s Nikkei Index rising 36.86 points to 8,822.7 and the stock index in Taiwan increasing 86.49 points to 4,826.94 at market close.

Chan-Sun Hong hcs@donga.com