On Friday (Washington time), US president Donald Trump unveiled the first phase of a deal with China to end their yearlong trade row that has roiled the global financial market and suspended a planned tariff hike.
The benchmark Korea Composite Stock Price Index closed at 2,044.61 Friday, up 1.2 percent from 2,020.69 a week earlier.
South Korea's stock market has wobbled in the wake of the prolonged American-Sino trade dispute.
South Korea's exports have dipped for 10 consecutive months since December amid the prolonged trade dispute between the world's largest economies -- the largest importers of South Korean products.
Also, investors will await the BOK's rate decision this week, with many expecting at least a quarter percentage point cut to 1.25 percent, given sluggish exports and continuing weak domestic consumption.
Such an outlook comes after BOK Gov. Lee Ju-yeol noted, "It may not be easy to meet the 2.2 percent growth target (this year)," before a parliamentary finance committee last week.
The central bank slashed the base rate by 25 basis points to 1.5 percent in July, its first rate cut in three years, citing slower-than-anticipated growth of the local economy in the first half.
The South Korean economy grew 1.9 percent from a year earlier in the first six months of the year. The BOK monetary board is scheduled to hold its next rate-setting meeting Wednesday.
"Also, low inflation may be another factor contributing to increased possibility of a rate cut, in that the country continues to see low price increases even though there may be temporary factors causing the low price rises," Kim Yoo-mi, analyst at Kiwoom Securities.
Another factor in focus is corporate earnings.
Market kingpin Samsung Electronics said last week its third-quarter operating profit is estimated at 7.7 trillion won ($6.47 billion). This exceeds market expectations of 6.99 trillion won, but would still be a more than 50 percent plunge from the same period last year.
Kim Byung-yeon, an analyst at NH Investment, said Samsung may be only one of many disappointments.
"The combined operating profit of KOSPI-listed firms and their net profit in the third quarter are expected to come to 34.6 trillion won and 24.1 trillion won, marking a 34 percent and 35 percent on-year drop, respectively," Kim said.
This week, foreigners sold a net 97.6 billion won worth of local shares, staying net sellers for an eighth consecutive session before snapping their selling streak Friday.
Individuals dumped a net 226 billion won, while institutions scooped a net 296 billion won. (Yonhap)