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Seoul: Shares rise modestly, won holds steady ahead of Fed meeting
[SEOUL] Seoul shares edged up in volatile trading on Tuesday morning, while the won held steady, as market participants adopted a wait-and-see posture ahead of the US Federal Reserve's rate-setting meeting later in the week.
The Korea Composite Stock Price Index (KOSPI) was up 0.2 per cent at 1,934.81 points as of 0233 GMT. Gainers outnumbered losers by 12 to 10. "Markets shrank ahead of the Fed meeting, while markets seem to already price in the negative effect from the probable first rate hike (in almost a decade)," said Kang Hyun-gie, a stock analyst at Dongbu Securities.
Foreigners purchased a modest 7.4 billion won (S$8.77 million) of shares in the main board by midday. If it holds steady until the market close, it would end a 28-straight-session selling streak.
Cheil Industries Inc resumed trade after changing its name to Samsung C&T Inc following a merger. Samsung C&T Inc makes up for 2.5 per cent of the main bourse's market value, ranking it the fourth biggest company. Samsung C&T rose 1.9 per cent to 161,500 won. "There's no special news about the merger today, while investors seem to expect the company to improve business strategy, further focusing on profitability through cutting costs from the synergy effect," said Kim Jang-won, an analyst at IBK Securities.
In currencies, the South Korean won remained flat, standing at 1,182.3 to the dollar, barely changed from the previous close of 1,183.1. "The won cut some of early gains as Shanghai shares opened sharply lower, and investors were wary of the BOJ's decision,"said Yuna Park, a foreign-exchange analyst at Dongbu Securities.
The Bank of Japan's policy decision is expected between 0300 GMT and 0500 GMT.
Park forecast the BOJ would hold rates steady, but investors were cautiously focused on whether it might signal additional easing in the future.
September futures on three-year treasury bonds were up 0.02 points at 109.59.