(RTTNews) - The South Korean stock market on Thursday saw an end to the modest two-day winning streak that helped it to gather nearly 50 points or 4.5 percent in the process. The KOSPI dropped markedly from resistance at 1,200 points, although analysts are predicting that the market could break through that plateau at the opening of trade on Friday.

The global forecast for the Asian markets is bullish as the bargain hunters are expectedto come out in force after a couple of rough sessions have consigned the markets to lower trade. There were some weak economic and corporate data out of the United States - but not as bad as was expected, also lending a bit of positive sentiment. The European markets finished in mixed fashion with a downside bias, but the U.S. markets all closed firmly in the green - and the Asian markets are predicted to follow suit.

The KOSPI finished sharply lower on Thursday, as the financial stocks fell under heavy selling pressure throughout the session. The industrials also were down, as were the technology stocks.

For the day, the index dropped 17 points or 1.46 percent to close at the daily low of 1,177.88 after peaking at 1,206.73. Volume was 455.87 million shares worth 5.21 trillion won. There were 558 decliners and 253 gainers.

Among the decliners, LG Electronics declined 2.95 percent, while Hynix Semiconductor slipped 1.79 percent, LG Display LCD ended down 1.93 percent, KB Financial plunged 5.03 percent, Korea Exchange Bank fell 5.05 percent, Woori Finance tumbled 3.90 percent, Daewoo Shipbuilding tumbled 3.57 percent, Kia Motors declined 2.70 percent, Hyundai Motor shed 0.58 percent, Asiana Air Line slumped 5.23 percent, Korean Air Line fell 3.42 percent, SK was down 1.81 percent, S-Oil ended down 1.65 percent and Samsung Heavy Industries plummeted 4.55 percent.

Bucking the trend, POSCO rose 0.53 percent, Samsung Electronics advanced 0.58 percent, SK Telecom was up 0.24 percent and KT rose 0.78 percent.

The lead from Wall Street is broadly positive as stocks showed a substantial turnaround over the course of morning trading on Thursday after showing some initial weakness. While the major averages were more or less rangebound for the remainder of the session, they still ended the day firmly in positive territory. While the early weakness came as traders reacted to some negative economic and corporate news, retail sales data that was not as bad as expected and some bargain hunting fueled the advance later in the day.

Stocks initially moved lower after the Labor Department’s weekly jobless claims report showed that first-time claims for unemployment benefits unexpectedly jumped to their highest level in over twenty-six years in the week ended January 31. The report showed that initial jobless claims rose to 626,000 from the previous week’s revised figure of 591,000. Economists had expected jobless claims to edge down to 580,000 from the 588,000 originally reported for the previous week.

Additionally, the Commerce Department’s monthly report on factory orders was released shortly after the market open and showed a bigger than expected 3.9 percent decrease in orders in December. This marked the fifth consecutive monthly decrease in orders.

In other news, Minneapolis Federal Reserve President Gary Stern spoke at the Capital City Partnership Annual Meeting in St. Paul, Minnesota on Thursday, offering a sliver of hope that actions by the Federal Reserve could help stabilize the financial markets. Although the economy is likely to remain in recession for at least two more quarters, Stern predicted that healthy growth would return by the middle of 2010.

The major averages ended the session firmly in positive territory, although off their best levels of the day. The Dow closed up 106.41 points or 1.3 percent at 8,063.07, the Nasdaq closed up 31.19 points or 2.1 percent at 1,546.24 and the S&P 500 closed up 13.62 points or 1.6 percent at 845.85.

In economic news, the South Korean economy faces a growing risk of falling into recession as deepening global economic woes, production and exports, among other things, are sharply shrinking and the local economy is slumping at a fast pace, the finance ministry said in its monthly economy-assessment report. The report called on the government to step up efforts to safeguard jobs and stimulate the fast-slowing economy by frontloading its fiscal spending this year.

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Posted in Categories: Eurozone, Releases, Stocks, USA.

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