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Seoul: Stocks, won largely flat ahead of Fed decision

Wednesday, December 14, 2016 - 11:05

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[SEOUL] South Korean shares and the won were muted in thin trade early on Wednesday as investors held back before the US Federal Reserve's rate decision later in the day.

The Korea Composite Stock Price Index (Kospi) was down 0.16 per cent at 2,033.25 points as of 0242 GMT, taking a breather after closing at about a 7-week high on Tuesday.

The South Korean won was quoted at 1,167.5 against the US dollar, down 0.04 per cent from its previous close of 1,167.0.

"A hike later in the day is largely priced in, but investors are still waiting to see the Fed's statement. A slightly more upbeat tone on the economy could bring the won down this week, as it could signal a faster pace of monetary tightening," said Kim Yoon-seo, an analyst at KTB Investment & Securities.

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Domestically, Mr Kim saw the political uncertainties related to parliament's impeachment of President Park Geun-hye as a risk that could drag on the won in the weeks leading up to the Constitutional Court's ruling on the parliament vote.

The court must decide whether to uphold the impeachment the parliament voted to approve on December 9, which could make her the first democratically elected leader of Asia's fourth largest economy to be removed from office in an influence peddling scandal.

Foreign investors net purchased 49.1 billion Korean won (S$59.8 million) worth of Kospi shares near mid-session, buttressing the index.

Decliners outnumbered advancers 466 to 313.

December futures on three-year treasury bonds rose 0.09 points to 109.57.

REUTERS

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