Korean stocks advanced 0.38 percent Friday as investor sentiment got a boost from Spain's pledge to cut spending and rising expectations for Chinese stimulus, analysts said. The local currency strengthened against the U.S. dollar.
The benchmark Korea Composite Stock Price Index (KOSPI) climbed 7.53 points to 1,996.23. Trading volume was moderate at 668.4 million shares worth 4.85 trillion won $4.36 billion) with gainers outpacing decliners 492 to 302.
"Spain's budget plan implies it is moving towards accepting the austerity measures proposed by European nations. The progress won't be easy but definitely is some relief for investors," said Kwak Byung-ryeol, an analyst at Eugene Investment & Securities Co.
Spain on Thursday announced its budget plan that the debt-mired country says will reduce its expenditure by some 40 billion euros ($51.7 billion) next year.
Positive views that China will soon bring in a monetary easing buoyed investor sentiment, following its recent policy changes to boost the stock market, Kwak added.
Foreigners fueled the KOSPI's gain, scooping up a net 176.3 billion won. Retail and institutional investors were net sellers.
Shares of insurance and telecom companies finished bullish. Leading nonlife insurer Samsung Fire & Marine Insurance surged 3.24 percent to 239,000 won and mobile carrier SK Telecom rose 1.73 percent to 147,000 won.
Large caps traded mixed, with Samsung Electronics inching up 0.6 percent to 1,346,000 won while auto parts maker Hyundai Mobis shedding 1.74 percent to 310,500 won.
Construction firms lost ground, dampened by the bankruptcy news of a local mid-sized builder and its holding company.
Kukdong Engineering & Construction and Woongjin Holdings filed for court receivership on Thursday after the builder failed to repay promissory notes worth 15 billion won.
The local currency surged to a yearly high of 1,111.40 won against the greenback, up 4.8 won from Thursday's close, on the back of the KOSPI's gain, dealers said.
Bond prices, which move inversely to yields, closed higher. The yield on three-year Treasuries inched down 0.02 percentage point to 2.79 percent and the return on the benchmark five-year government bonds rose 0.02 percentage point to 2.87 percent. (Yonhap)