Seoul stocks spike over 5% on Fed’s asset purchase scheme

Seoul stocks spike over 5% on Fed’s asset purchase scheme

By YonhapPublished : Jun 16, 2020 – 16:10       Updated : Jun 16, 2020 – 16:43

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(Yonhap)
(Yonhap)

South Korean stocks spiked over 5 percent Tuesday on the Federal Reserve’s plan to purchase corporate bonds, which fueled optimism over a quicker-than-expected recovery in the global economy. The Korean won sharply rose against the US dollar.

The benchmark Korea Composite Stock Price Index (KOSPI) surged 107.23 points, or 5.28 percent, to close at 2,138.05. Trading volume was high at about 947 million shares worth some 13.4 trillion won ($11.1 billion), with gainers outnumbering losers 868 to 26.

Foreigners bought a net 90.4 billion won, ending a five-day selling streak, and institutions purchased a net 472.2 billion won. Individuals offloaded a net 574.4 billion won.

The secondary KOSDAQ also shot up 42.23 points, or 6.09 percent, to finished at 735.38. Foreigners snatched a net 425 billion won, the largest daily sum since the tech-laden index launched in 1996.

The KOSPI remained bullish the entire session, rebounding from the previous session’s 4.76 percent fall amid fears of a second wave of the new coronavirus in the United States and China.

The market’s rally came after the US Federal Reserve’s decision to start purchasing a “broad and diversified portfolio” of corporate bonds.

The plan is part of the Fed’s quantitative easing project to ensure companies can borrow through the bond marke

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