Korea Tourism Stocks Jump on Bets for Return of Chinese Visitors

Heejin Kim and Abhishek Vishnoi, Bloomberg News

A customer tries out a product in a store of Innisfree, an Amorepacific Corp. cosmetic brand, at the Ngee Ann City shopping and commercial center in Singapore, on Tuesday, Sept. 12, 2017. South Korea's biggest cosmetics maker is revamping its products to suit Muslims and darker-skinned women in Southeast Asia as it tries to make up business lost because of political tensions with China over a missile-defense system. Photographer: Nicky Loh/Bloomberg , Bloomberg

(Bloomberg) -- The years-long disputes between China and South Korea are getting resolved, and analysts at Nomura Holdings Inc. expect Chinese tourists to return en masse to the nation of K-Pop.

That’s a boon for shares of cosmetics producers and travel-related companies. Amorepacific Corp., the maker of beauty products that are popular souvenirs among Chinese women, climbed as much as 6.6% on Monday. Peer Kolmar Korea Co. surged 12%, while travel agency Modetour Network Inc. rallied 7.7%.

Media reports in China said several of its major tour agencies would restart selling five to six tour packages to South Korea, according to a Nomura note Friday. The firm said its research showed Chinese group-package trips are resuming and got confirmation from a major travel agency in the country that its tour companies have started offering services to domestic customers for the upcoming spring festival.

The ties between the two countries soured after the U.S. deployed a missile shield in South Korea in 2017 to protect the nation from its northern neighbor.

Last week, a handful of travel-linked stocks rallied on expectations that relations between South Korea and China may improve, with a possible visit by Chinese President Xi Jinping to Seoul, which would be the first since President Moon Jae-in took office in 2017.

To contact the reporters on this story: Heejin Kim in Seoul at hkim579@bloomberg.net;Abhishek Vishnoi in Singapore at avishnoi4@bloomberg.net

To contact the editors responsible for this story: Lianting Tu at ltu4@bloomberg.net, Cecile Vannucci