South Korean shares closed higher on Friday for a fifth straight session amid strong gains by chip stocks and an overnight rally on Wall Street. U.S. stocks gained, with the S&P 500 hitting a record high after softer wholesale inflation eased concerns over interest rates.
The U.S. producer price index was unchanged in July from June, indicating that factory-gate inflation had stabilized before the recent increase in oil futures. Expectations for a U.S. Federal Reserve rate hike in September also weakened in futures markets, driving investor optimism higher.
The Korea Composite Stock Price Index, or Kospi, increased by 164.6 points, or 2.4%, to close at 6,977.94. The Kosdaq also rose by 3.28 points, or 0.4%, to close at 864.65.
In economic news, South Korea's export prices surged 49.1% year over year in July, according to preliminary data released by the Bank of Korea on Friday.
On a month-over-month basis, export prices edged up 1%.
Meanwhile, import prices rose 18.7% from a year earlier, compared with a revised 20.9% expansion in June. On a month-over-month basis, import prices declined 1%, softer than the previous month's 4.2% drop.
In corporate news, HS Hyosung Advanced Materials (KRX:298050) provided a 141.5 billion won guarantee on affiliate HS Hyosung Vietnam's debt of the same amount with Vietcombank, Nhon Trach Branch, according to a Friday filing with the Korea Exchange.
The debt guarantee relates to the extension of the maturity of the existing trade finance facility for HS Hyosung Vietnam. The guarantee period will last until Aug. 18, 2027, the filing said.
Shares of Hyosung Advanced Materials added 3% at market close.