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Seoul: Won down at 1-week low as US dollar jumps after Opec deal; stocks up
[SEOUL] The South Korean won slipped to a one-week low early on Thursday, pressured by a broadly strong US dollar after oil prices jumped on Opec's agreement to its first output cuts since 2008.
The local currency trimmed some losses after data showed activity in China's manufacturing sector expanded more than expected in November and South Korean exports rose for the first time in three months in November.
The won was quoted at 1,175.2 against the US dollar as of 0200 GMT, down 0.5 per cent from Wednesday's close of 1,169.1. It was trading near lows seen last Friday.
With the US dollar's "breather" from a rally coming to an end, "the won may slump to 1,180 today," said Jung Sung Yoon, a foreign exchange analyst at Hyundai Futures.
The US dollar and regional stocks rose after the Organization of the Petroleum Exporting Countries on Wednesday agreed to its first output cut since 2008, aiming to reduce 1.2 million barrels per day (bpd), or over 3 per cent, from January.
A political crisis at home has buffeted South Korean markets in recent week, as worries grow of a hit to consumer and business confidence.
South Korean opposition parties vowed on Wednesday to push ahead to try to impeach President Park Geun Hye amid a growing influence-peddling scandal, rejecting her offer to resign, and called on members of her Saenuri Party to join them.
South Korean shares edged up, with the Korea Composite Stock Price Index (Kospi) up 0.2 per cent at 1,987.74 points.
Institutions dumped 65 billion won (S$79.22 million) worth of shares near midday, retail investors and foreigners purchased a net 60.8 billion won and 5.4 billion won worth of stock, respectively.
Construction shares rose 2.6 per cent, rallying on the Opec deal as investors hoped South Korean construction companies in the Middle East would do better if oil prices rise further and boost the region's economy.
Medical supplies shares underperformed the bourse, down 3 per cent, dragged down by Samsung Biologics slumping more than 4 per cent.
December futures on three-year treasury bonds shed 0.04 points to trade at 109.28.