South Korean stocks advanced Tuesday as investors returned to buying mode on hope of additional stimulus from the European Central Bank, analysts said. The local currency rose against the U.S. greenback.

The benchmark Korea Composite Stock Price Index gained 7.16 points, or 0.35 percent, to close at 2,068.05. Trading volume was slim at 283 million shares worth 3.6 trillion won ($3.5 billion), with gainers beating losers, 499 to 304.

Market watchers said investors went bargain hunting, picking up shares that had been largely undervalued and those of exporters that suffered due to the strong local currency.

“Foreigners turned net buyers as they expected the European Central Bank to ease monetary policy to boost the sluggish eurozone economy sometime soon,” Park Seung-yong, an analyst at KDB Daewoo Securities, said. “Investors loaded up on undervalued shares and sold stocks that had surged recently.”

Shipbuilders rallied after the state-run Korea Gas Corp., the world’s biggest liquefied natural gas buyer, announced a 1.3 trillion won bid to buy six LNG tankers to transport shale gas over the next 20 years.

Hyundai Heavy Industries, the world’s largest shipbuilder, rose 3 percent to 137,500 won, and No. 2 Daewoo Shipbuilding and Marine Engineering added 4.66 percent to 23,600 won. Hyundai Mipo Dockyard also jumped 7.44 percent to 115,500 won.

Construction stocks also rose on hope of the improving real estate market as the government pushes to revive the stagnant market through eased mortgage loans and a key interest rate cut.

The latest financial data said outstanding mortgage lending had nearly doubled from end-July to Aug. 22.

Daewoo Engineering and Construction rose 5.57 percent to 8,720 won, while KCC Engineering and Construction inclined 4.78 percent to 10,950 won after the company struck a 69.7 billion won deal to build an apartment complex in the southeastern city of Geoje.

Hankook Cosmetics jumped 14.93 percent 4,350 won to its all-time high after the company signed a 75 billion won deal with Wonderway HongKong Limited to provide its cosmetics and skin care brands in China, Hong Kong and Taiwan for the next five years. Its affiliate, Hankook Cosmetics Manufacturing, also soared 14.84 percent to 10,600 won.

AmorePacific, the nation’s leading cosmetic company, went down 1.92 percent to 2,244,000 won as investors locked in gains from the recent surge.

Auto shares were up on easing local currency against the dollar. Top automaker Hyundai Motor inclined 0.44 percent to 226,000 won, and its smaller affiliate, Kia Motors, edged up 0.51 percent to 59,200 won.

Market bellwether Samsung Electronics underperformed the broader market as foreigners continued to dump its shares on a grim outlook for its mainstay handset business in the third quarter. (Yonhap)