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Rebounding Oil Prices Boosts Seoul Stocks

Rebounding oil prices boosted South Korean stocks

South Korean stocks opened higher Thursday due to rebounding oil prices and an apparent slowdown in the COVID-19 pandemic.

The Korea Composite Stock Price Index (KOSPI) rose 0.55 percent, to 1,906.49 in the first 15 minutes of trading.

However, KOSPI's surge would depend on investors' assessment of the impact of the COVID-19 pandemic on the global economy and corporate earnings in the coming quarters.

The country's economy suffered a 1.4 percent in the first quarter of the year from three months earlier, its worst since 2008.

Investors are now awaiting data of the first-quarter business results of major companies set to be released from this week to base their decisions in reorganizing their portfolios.

Korean Air Lines Co. rose 2.6 percent, refiner SK Innovation Co. went up 1.9 percent, Hyundai Motor Co. climbed 1.5 percent, and Samsung Electronics Co. gained 0.3 percent.

However, cosmetics firm AmorePacific Corp. declined 0.9 percent, chipmaker SK hynix Inc. dropped 0.7 percent, and tobacco company KT&G Corp. declined 0.5 percent.

On Wednesday, Korean stocks also showed positive signs, when it snapped a two-day losing streak, due to the government's stimulus packages and recovering oil prices.

The KOSPI index dipped 16.77 points, or 0.89 percent, to close at 1,896.15.

The government's aid package will be increased from the previously set 100 trillion won to 135 trillion won.

Of the amount, 20 trillion won will be used to acquire more corporate bonds and 10 trillion won will be lent to small businesses.

"Retail investors' aggressive stock buying gave a boost to the KOSPI index amid ample liquidity in the market," said NH Investment & Securities Co. analyst Noh Dong-kil.

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