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Seoul: Shares hit 3-month high, won firmer after Yellen


[SEOUL] South Korean shares scaled a fresh 3-month high on Wednesday after Federal Reserve Chair Janet Yellen refrained from giving clear hints on when the US central bank would raise interest rates.

The Korea Composite Stock Price Index (KOSPI) climbed 0.75 per cent to 1,990.91 points as of 0200 GMT, the highest intraday level since Nov 27.

"Yellen has made it clear that any changes in the Fed's forward guidance only allows consideration of a rate rise, but in itself does not guarantee a hike after the next two meetings," said Shinyoung Securities in a note to clients.

The KOSPI index broadened its gains after a private survey showed China's factory activity had risen to a four-month high in February, marginally beating analyst forecasts.

Market players also cheered the approval of Greece's reform proposals by the euro zone, allowing the heavily indebted nation to extend its financial lifeline by four months and avoid immediate insolvency.

Bargain hunters locked in on recent underperformers such as commodity-linked shares, with LG Chem gaining 2.5 per cent while Hyundai Heavy Industries rose 2.2 per cent.

Samsung SDS rallied 3.7 per cent while Cheil Industries climbed 1.6 per cent, with both KOSPI components set to be added to the KOSPI 200 benchmark next month.

Offshore funds underpinned the market, with foreigners buying 99.1 billion won (S$121.8 million) worth of shares on the main bourse by late morning.

The KOSPI 200 benchmark of core stocks gained 0.72 per cent while the junior, tech-heavy KOSDAQ edged down 0.21 per cent.

The South Korean won firmed against the dollar on Wednesday, tracking broad weakness in the greenback after Yellen held back from giving a clear view on the timing of the next US rate hike.

The local currency was quoted at 1,103.8 to the dollar as of 0200 GMT, compared with 1,109.9 seen at the end of Tuesday's session.

March futures on three-year treasury bonds added 10 basis points to trade at 108.50.