Seoul shares rise 1.3 pct, volume low amid caution

Reuters - Friday, November 6

* Trading still lacklustre

* POSCO up 4 pct; brokers, car parts and battery firms gain

* Rising won, caution ahead of U.S. data cap upside

* Growing perception of bottom but energy lacking - analyst

By Kim Yeon-hee and Rhee So-eui

SEOUL, Nov 6 - Seoul shares rose 1.3 percent on Friday, with brokerages, steel makers and auto parts-related shares advancing against the backdrop of a Wall Street gain, but caution lingered over the stronger won and upcoming U.S. data.

The market was helped by healthy U.S. productivity and jobless claims data on Thursday, but investors were still wary ahead of Friday's U.S. employment report, which is expected to show the fewest job losses since August 2008.

"There's a spreading perception that the market is bottoming, but investors are still largely inactive, as you can see in the trading volume," said Hwang Chang-joong, a market analyst at Woori Investment & Securities.

"The market's energy is limited and investors want to see first what others do."

The Korea Composite Stock Price Index <.KS11> finished at 1,572.46 points. Trading volume was about 248 million shares, still weak after hitting a 14-month low on Thursday.

The index still lost 0.5 percent on the week, and the close was nearly 10 percent short of a 15-month high hit in late September.

The won <KRW=> rose over 1 percent to hit its strongest in more than two weeks against the dollar, denting the outlook for exporters. [ID:nSEO223261]

Steelmakers rose on the back of hopes of demand recovery on the improving global economy. POSCO <005490.KS> jumped 4.18 percent and Hyundai Steel <004020.KS> climbed 3.03 percent.

The brokerage sector sub-index <.KS53> rose 2.59 percent as hopes that the stock market would resume gains after recent weakeness bolstered securities firms. Daewoo Securities <006800.KS> rose 4.62 percent and Woori Investment & Securities <005940.KS> advanced 4.67 percent.

Also in the spotlight were automotive parts and electric car battery shares, less affected by the strengthening won than car makers and with growth potential. Shares in Hyundai Mobis <012330.KS> rose 4.25 percent while Samsung SDI <006400.KS>, which operates a auto battery joint venture with Germany's Robert Bosch, finished up 2.81 percent.

SK Energy <096770.KS> also climbed 3.26 percent on expectations for its car battery business.

Korean Air <003490.KS> jumped 5.75 percent helped by the rising won, which will lower its fuel costs, and on the news that its parent Hanjin Group signed an agreement with creditors to improve its financial base.

GS Engineering & Construction <006360.KS> rose 5.29 percent thanks to its strong business prospects in the Middle East, following Thursday's $3.1 billion refinery order. [ID:nSEO91248]