Securities firms set to further rise on increased turnover, friendly policies

Seoul, Oct 6 (IANS) Shares in securities firms, which have already doubled this year, are widely expected to further advance down the road on the back of increased turnover and market-friendly steps, industry watchers said on Monday.

According to the Korea Exchange (KRX), the index tracking listed securities firms' stock movement has nearly doubled this year, joining the ranks of top-performing sectors, reports Yonhap news agency.

The benchmark index, the KOSPI, has rallied by more than 43 per cent so far this year, and retail investors flocked to the market out of fear of missing out.

In September alone, the securities firm-tracking stock index gained 8.2 per cent, far higher than the 0.5 per cent gain of the KOSPI.

In line with a market bull run, the daily stock turnover, which includes transactions on the country's first alternative stock trading platform, NXT, reached 27 trillion won ($19.3 billion), up from the previous month's 22.7 trillion won.

During the third quarter of the year, the daily turnover rose 9.7 per cent on-quarter to 26 trillion won.

"Foreign buying, coupled with increased turnover, will help propel the local stock market," said Koh Yeon-su, an analyst at Hana Securities.

"Securities firms are positioned to benefit from this trend," Yeon-su added.

Yoon Yu-dong, an analyst at NH Investment & Securities, said backed by an easing monetary cycle, the daily turnover will reach 30 trillion won this year and further rise to 37 trillion won in 2026 and 43 trillion won in 2027.

Analysts said a series of market-friendly measures, such as treasury share reform and tax policies, are another boon for securities firms.

"All conditions are ripe for brokerage firms' earnings improvement," said Yoon of NH Investment & Securities.

"It will be one of the shining sectors this year," Yoon added.

--IANS

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