*

KOSPI index hits record high, Hyundai and Kia shares surge

*

South Korea seeks currency swap line to mitigate market

impact

of investment package

*

U.S. Treasury Secretary expects trade deal announcement

within

10 days

(Adds context, trade official comment, market reaction from

paragraph 3)

By Jihoon Lee

SEOUL, Oct 16 (Reuters) - South Korea's chief

presidential policy adviser said on Thursday he was "optimistic"

about ongoing talks to finalise a trade deal with the U.S., in

the latest remarks by officials suggesting progress in

negotiations that had stalled for months.

Kim Yong-beom and Industry Minister Kim Jung-kwan spoke to

reporters before departing for the United States. They will be

joining Finance Minister Koo Yun-cheol and Minister for Trade

Yeo Han-koo for follow-up negotiations in Washington.

Kim's comments echo Minister Koo's

remarks

earlier this week that there was "huge progress" and

Foreign Minister Cho Hyun saying there were "positive signals"

in reaching a deal.

On the U.S. side, Treasury Secretary Scott Bessent said

on Wednesday the countries were close to finalising a

trade deal

and he expected an announcement in the next 10 days. Seoul

has been seeking to reach a deal by late October when U.S.

President Donald Trump is due to visit the country for an

Asia-Pacific summit.

South Korea agreed in late July a preliminary deal with

Trump lowering U.S. tariffs on imports to 15% from 25%, in

return for South Korean investment of $350 billion in U.S.

strategic industrial sectors.

A promised cut in U.S. tariffs on auto imports to 15%

from 25%, however, has not been implemented for South Korea amid

stalled negotiations over the details of the investment package,

while rival Japan secured this last month after finalising its

deal including $550 billion investments in the U.S.

Seoul has been concerned over the foreign exchange

implications and the structure of the investment package and

asked Washington for a safeguard, such as a currency swap line,

to prevent any currency market impact.

South Korea's benchmark KOSPI stock index rose

as much as 1.9% to a record high on Thursday, as shares of

Hyundai Motor ( HYMLF ) surged 9.6% to a one-year high and

sister automaker Kia jumped 8%.