[SEOUL] South Korean shares gave up some earlier gains and remained flat on Monday morning, with investors bracing for higher US interest rates.
Recent pressure from foreign stock selling countered optimism from a Wall Street rally on upbeat US jobs data.
"Markets are already pricing in a Fed tightening. That's why the shares trimmed earlier gains in the morning session despite a rally in Wall Street over the weekend," said Lee Jae-man, a stock analyst at Hana Daetoo Securities.
The Korea Composite Stock Price Index (KOSPI) was quoted at 1,974.99 points as of 0239 GMT, almost unchanged from the previous close of 1,974.40. Declining issues slightly outnumbered advancers by 12-to-10.
On Friday, data showed non-farm payrolls increased 211,000 in November, the US Labour Department reported, while September and October data was revised to show 35,000 more jobs than previously reported. The figures suggest the economy is strong enough to bear an expected first rise in interest rates in almost a decade.
Tech giant Samsung Electronics and Semiconductor chipmaker SK Hynix Inc both lost ground, slipping 0.2 per cent and 0.3 per cent, respectively.
In contrast, shares of oil refiners rose thanks to high refining margins despite low crude oil prices, with SK Innovation Co Ltd advancing 2.3 per cent and S-Oil Corp leaping 3.9 per cent.
Foreign investors sold a net 126.2 billion won (S$151.5 million) worth of KOSPI shares near mid-session, weighing on the index.
The South Korean won was quoted at 1,166.8 per dollar, down 0.9 per cent from Friday's onshore close of 1,156.7.
"Today the won would remain around 1,160 level in volatile trading, after upbeat US jobs data," said Jeon Seung-ji, a fixed-income analyst at Samsung Futures, referring to non-farm payrolls.
December futures on three-year treasury bonds quoted at 109.18, unchanged from the previous close.