SEOUL (Reuters) - Seoul shares climbed more than 1 percent to a one-week intraday high on Tuesday, buoyed by short-covering as a rebound in the won against the dollar prompted buying among foreign investors.
"The won is poised to break through the 1,200 mark against the dollar, prompting short-covering by foreign investors who are eyeing a foreign-exchange rate boost to their capital margins," said Daishin Securities analyst Ham Sung-sik. "Heavy capital inflows were also seen in programme trading, easing pressure on the index, which has been weighed down by redemptions and settlements on expiring options in recent weeks."
The Korea Composite Stock Price Index (KOSPI) was up 1.21 percent at 2,026.83 as of 0323 GMT.
Offshore investors were buyers of a net 41.5 billion won ($36.9 million) worth of shares, institutions bought a net 67.1 billion won.
Banks rallied across the board as jitters over the Greek debt crisis subsided, and as a strong won pointed to improved risk appetites and an active money market.
Shinhan Financial Group Co Ltd climbed 4.66 percent, while Hana Financial Group Inc jumped 4.7 percent.
Automobile-related counters were also strong performers, with investors finding bargains in the high-beta sector that has lagged in recent sessions.
"These are one of few high-beta stocks that underperformed even when the index rose. With a rebound in the yen weakening Japanese competitors, and the U.S. FTA deal set to come into effect soon, they're looking highly undervalued," said Park Young-ho, a sector analyst at Daewoo Securities.
Hyundai Motor Co rose 3.71 percent, while parts maker Hyundai Mobis Co Ltd advanced 5.61 percent.
The won's strength also eased import cost pressures on crude oil refiners. SK Innovation Co Ltd , the country's largest refiner, rose 3.81 percent, while GS Holdings Corp gained 3.38 percent.
The dollar was traded at 1,120.50 won, down 0.24 percent from Monday.
Large-cap technology issues were also a source of support. Samsung Electronics Co Ltd firmed 1.16 percent, and LG Display Co Ltd was up 0.91 percent.
Investors are keeping a close watch on signs of a stance shift by the U.S. Federal Reserve when its policymaking panel convenes on Tuesday, as well as U.S. retail data slated for release later in the day.
($1 = 1124.050 Korean Won)
(Reporting by Joonhee Yu; Editing by Chris Lewis)