Seoul shares edge up; Samsung Elec at 6-month high
Seoul shares inched up in morning trade on Wednesday, as Samsung Electronics climbed to its highest level in more than six months after a brokerage lifted its target price and earnings estimates for the benchmark heavyweight.
But gains for the overall market were capped after U.S. Federal Reserve Chairman Bernanke said the central bank does not have the tools to offset a potential recession if politicians fail to strike a deal to prevent a fiscal shortfall of some US$600 billion.
The Korea Composite Stock Price Index (KOSPI) ticked 0.2 per cent higher to 1,894.41 points as of 0228 GMT, supported by continued foreign buying.
“The KOSPI is faltering as it nears the psychological barrier of 1,900,” said Cho Byung-hyun at Tongyang Securities, but added that it could break above that level in the near-term given that U.S. data is showing an improving picture of the economy ahead of the year-end shopping season.
Samsung Electronics, the biggest South Korean firm by market value, was up 2.4 per cent at 1.396 million won, and looked set to put in a third straight day of gains.
KDB Daewoo Securities on Wednesday lifted Samsung’s target price to 1.9 million won from 1.65 million won, as well as its earnings estimates for the current quarter and next year, saying it expects the company to solidify its lead in the smartphone market.
Other technology stocks lost ground, with Samsung’s phone rival LG Electronics shedding 2.8 per cent, while panel maker LG Display fell by 1.9 per cent.
Investors rushed to snapped up defensive plays, with the leisure and consumer indices gaining more than 1 per cent.
The KOSPI 200 benchmark of core stocks was up 0.2 per cent, while the junior KOSDAQ edged 0.5 per cent higher.