South Korean stocks will likely extend their gains next week and approach to 2,000 points on the back of continued foreign buying and easing fears over the eurozone debt crisis, analysts said Saturday.
The benchmark Korea Composite Stock Price Index (KOSPI) rose 3.95 percent from the previous week to 1,949.89, closing at its highest level since the first-ever downgrade of U.S. sovereign rating on Aug. 5.
The weekly gain came as France and Spain's strong debt auctions helped stave off investor concerns following eurozone sovereign rating cuts by Standard & Poor's, according to analysts.
Shares of brokerages spearheaded the gains, with auto and financial issues lending support.
Foreigners shored up the KOSPI by snapping up shares worth around 3.06 trillion won (US$2.7 billion) last week alone, extending their buying streak to a ninth session.
Analysts said the main stock index may break the 2,000 mark next week if foreign buying continues.
"There are uncertainties such as Greek default concerns, but they are unlikely to affect foreign sentiment. It seems the local bourse's low valuation is appealing to overseas investors," said Kim Se-joong, an analyst at Shinyoung Securities Co.
Analysts said market optimism may linger as worries over Greece's default subside amid ongoing talks over Greek government debts.
They also said investors are likely to move their focus to U.S. factors, such as upcoming corporate earnings results and the Federal Open Market Committee meeting set for Wednesday.
The local stock market will be closed on Monday and Tuesday for the Lunar New Year's holiday.