Seoul: Shares flat, won up after BOK holds rates steady

[SEOUL] South Korean shares were flat early on Thursday as investors looked to next week's US rate decision after the Bank of Korea kept policy steady amid growing concern over China's economy.

As widely expected, South Korea's central bank held its policy interest rate at a record low of 1.50 per cent.

The market was awaiting a news conference by Bank of Korea Governor Lee Ju-yeol at 0220 GMT.

At 0150 GMT, the Korea Composite Stock Price Index (KOSPI) was marginally lower at 1,947.76 points, its lowest intraday level since Nov 16. Losers outnumbered winners by 2-to-1.

"Market reaction was largely muted after BOK held rates since it was widely expected. Investors are turning to the Fed meeting," said Kang Hyun-gie, a stock analyst at Dongbu Securities.

Samsung Electronics Co Ltd gained 0.8 per cent and steelmaker POSCO rose 1.8 per cent.

Airline shares rose on falling oil prices, with Korean Air Lines Co Ltd advancing 2.9 per cent and Asiana Airlines Inc 2.8 per cent.

Foreigners offloaded a net 106.5 billion Korean won (S$127 million) of shares in the main board by midday, set to extend their selling spree to a seventh straight session.

The South Korean won gained the after dollar index eased overnight.

BOK's rates decision also buttressed the won, although its increase was limited by a cautious outlook on the Federal Reserve's policy decision.

The won was quoted at 1,175.6 per dollar, up 0.3 per cent.

December futures on three-year treasury bonds was quoted at 109.33, unchanged from the previous close.

REUTERS