South Korean shares surge on Bernanke comments

South Korean shares surged on Thursday as investors hailed U.S. Federal Reserve Chairman Ben Bernanke's comments over the maintenance of quantitative easing for the foreseeable future. The benchmark Korea Composite Stock Price Index (KOSPI) jumped 53.44 points, or 2.93 percent, to close at 1,877.60, the highest gain since Sept. 27, 2011. Trading volume stood at 327.36 million shares worth 3.91 trillion won (3.48 billion U.S. dollars). Foreign investors turned into net buyers for the first time in seven trading days after Bernanke said overnight that highly accommodative monetary policy for the foreseeable future will be necessary for the U.S. economy, quelling market jitters over an early exit. Overseas investors bought local shares worth 276.9 billion won, with their purchase centered on tech and auto stocks. Institutional investors purchased a net 303.2 billion won worth of shares, but retail investors dumped a net 574.4 billion won worth of shares in a bid to lock in profits. Bank of Korea froze its policy rate at 2.5 percent amid lingering concerns over an early U.S. exit. The world's largest economy added 195,000 jobs in June, beating analysts' estimates. The better-than-expected jobs report raised speculation over the possible start of reduction in the bond purchases from September. Market bellwether Samsung Electronics soared 5.1 percent due to foreign buying. Top automaker Hyundai Motor increased 1.4 percent, and its affiliate Kia Motors added 1 percent. The nation's biggest auto parts maker Hyundai Mobis jumped 5.3 percent. Leading chemical firm LG Chem advanced 4.1 percent, and top wireless carrier SK Telecom climbed 2.4 percent. The local currency finished at 1,122.1 won against the greenback, up 13.7 won from Wednesday's close. Bond prices ended sharply higher. The yield on the liquid three- year treasury notes tumbled 0.1 percentage point to 2.84 percent, and the return on the benchmark 10-year government bonds plunged 0. 16 percentage point to 3.37 percent.