Victek, Defense Shares Gain on North’s Nuclear Test: Seoul MoverSaeromi Shin
Victek Co. led gains among South Korean defense-related stocks in Seoul trading after North Korea conducted a nuclear test.
Victek, a maker of electronic warfare equipment, jumped by the daily limit of 15 percent to 2,500 won at the close, its biggest gain since April 9. Firstec Co., a maker of components for helicopters and armored vehicles, rose 13 percent, while Speco Co. added 15 percent.
North Korea detonated underground “an atomic warhead that is lighter and miniaturized but with a big explosive charge,” the nation’s official news agency said in a statement. The country’s third nuclear test underscores a disregard for an international community that has already isolated the totalitarian state from the global economy.
“The news drove defense stocks up nicely,” Kim Gi Bo, a Seoul-based fund manager at Friend Investment Management, said by phone today. “But in many cases, it’s irrelevant to the companies’ earnings so investors should be cautious in making investments.”
North Korea conducted nuclear tests in 2006 and 2009. South and North Korea technically remain at war after their 1950-1953 conflict ended without a peace treaty.