Korean stocks up for second day straight as China may ease restrictions

Stocks gained for a second consecutive day Wednesday amid hope that China could ease Covid-19 restrictions, with eyes on U.S. Federal Reserve Chair Jerome Powell's upcoming speech on the economy. The local currency rose against the dollar.

A screen in Hana Bank's trading room in central Seoul shows the Kospi closing at 2,472.53 points on Wednesday, up 39.14 points, or 1.61 percent, from the previous trading day. [YONHAP]

Stocks gained for a second consecutive day Wednesday amid hope that China could ease Covid-19 restrictions, with eyes on U.S. Federal Reserve Chair Jerome Powell's upcoming speech on the economy. The local currency rose against the dollar.

The benchmark Kospi advanced 39.14 points, or 1.61 percent, to close at 2,472.53. Trading volume was heavy at 564.2 million shares worth 11.3 trillion won ($8.57 billion) with gainers outnumbering decliners 626 to 234.

"Chinese authorities' announcement yesterday fell short of expectations about the reopening, but Beijing has been signaling an acceleration in its push to ease the lockdowns," Kiwoom Securities analyst Han Ji-young said.

On Tuesday, China's health officials said the country would implement Covid-19 rules more flexibly and respond to urgent concerns raised by the public, amid escalating protests against strict virus curbs in the industrial hub of Guangzhou.

Foreigners bought a net 1,007.1 billion won worth of shares, the largest amount since May 31. Institutions offloaded a net 365.1 billion won and retail investors a net 604.2 billion won.

Powell is scheduled to speak on the economic outlook at a Brookings Institution session on Wednesday and is likely to give a guideline on when the U.S. central bank will start to scale back the rate hike.

In Seoul, most major shares finished higher. Samsung Electronics jumped 2.6 percent to 62,200 won, and LG Energy Solution soared 2.5 percent to 587,000 won.

Posco Holdings rose 2 percent to 299,500 won, and LG Electronics shot up 4 percent to 97,600 won.

Shares in Doosan Bobcat, a construction power equipment maker, plunged 14 percent to 35,550 won after four local brokerage firms unloaded all of their holdings in the company in block deals before the opening bell.

The won ended at 1,318.80 won against the dollar, down 7.8 won from Tuesday's close.

The Kosdaq added 2.00 points, or 0.27 percent, to close at 729.54 points.

Bond prices, which move inversely to yields, closed higher. The yield on three-year government bonds lost 5.7 basis points to 3.666 percent, and the yield on 10-year government bonds fell 1.8 basis points to 3.654 percent.

BY CHO JUNG-WOO, YONHAP [cho.jungwoo1@joongang.co.kr]