Korean stocks, won gain on U.S.-China mini trade deal

South Korean stocks gained more than 1 percent on Monday as investors raised hopes for eased tensions on the trade front after the partial trade deal between the United States and China.

The benchmark Korea Composite Stock Price Index (Kospi) finished Monday at 2,067.40, up 1.11 percent, or 22.79 points, from Friday’s closing. The Kospi opened the session 1.15 percent, or 23.52 points, higher from Friday at 2,068.13 and rose to as high as 2,075.10 during trading.

Foreigners net purchased 22.3 billion won ($18.8 million) worth of shares and institutional investors 222 billion won.

Seo Sang-young, analyst at Kiwoom Securities, said local shares were boosted by improved investor sentiment after a mini trade deal was announced between the U.S. and China on Friday. He expected offshore investors’ appetite for local shares to remain strong amid strengthening of the Korean won.

On Friday, U.S. President Donald Trump announced the first phase of a deal with China to end months of trade war that has weighed on financial markets around the world. The mini deal is seen as a progress, although more efforts would be needed by the two countries to reach a final agreement covering areas such as agriculture, currency, and intellectual property protection.

Large-cap stocks, meanwhile, led the rally. Samsung Electronics Co. gained 1.73 percent to close at 50,000 won. Its shares hit 50,300 won during the day, the first time above 50,000 won since June 11,last year. SK Hynix Inc. ended 0.63 percent higher, Posco 1.55 percent, and Shinhan Financial Group 2.78 percent.

The heavy-tech secondary Korea Securities Dealers Automated Quotation (Kosdaq) ended 1.34 percent, or 8.51 points, higher at 641.46 on Monday.

The partial trade deal reached between the U.S. and China also aided the won on expectations of relief on exports.

The U.S. dollar ended at 1,184.9 won, 3.9 won lower from Friday. Analysts expect the greenback to touch below 1,180 won this week for the first time in three months.

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