KOSPI Index Continues Record Ascent

The Korea Composite Stock Price Index (KOSPI) climbed for the 12th consecutive day yesterday, surpassing the 1,400 won mark.

The won-yen exchange rate fell below 810 won per 100 yen, however, and the won continued its fall against the dollar.

The KOSPI rose by 5.36 points, or 0.38 percent from the previous day, to close at 1,402.36 on April 7, surpassing the 1,400 mark in three months since January 16 (1,421.79).

The current 12-day run is the second-longest KOSPI climb in history. The longest was 13 days, from January 19 to February 2 in 1984.

The tech-heavy KOSDAQ index increased for the eighth consecutive trading day and closed at 694.35, up by 0.58 point or 0.08 percent.

Massive foreign purchases sparked up the hike in stock prices.

Foreigners purchased some 51.6 billion won in shares yesterday. Looking into the last six trading days, the accumulated net purchases amounted to 1.3 trillion won. Institutional investors bought shares worth some 46.8 billion won.

Park Cheon-ung, managing director at Woori Investment and Securities, said, “Factors burdening the stock market, such as the fall in currency rates or worsening results for the second quarter (April to June) now seem to be ineffective.” He said that there will be more days for increases rather than a fall in stock prices until June, forecasting a bullish market.

The won-yen rate closed at 809.24 won per 100 yen that day.

This is the first time in eight years and five months since November 18, 1997 (804.74) for the figure to drop below 810 won.

The won-dollar rate fell to 948.5 won at one point during the morning but recovered as the authority intervened and closed at 953.2 won, falling by 0.3 won from the previous day. This is the lowest rate since the 939.9 won recorded on October 27, 1997, and the rate has fallen for six consecutive trading days.

Wan-Bae Lee Suk-Min Hong roryrery@donga.com smhong@donga.com