You are here

Seoul: Won falls after Greece defaults on IMF loan; shares bounce

Wednesday, July 1, 2015 - 11:14
OREX4.jpg
The South Korean won fell against the dollar on Wednesday in reaction to a cautious mood after Greece became the first developed economy to default on a loan with the International Monetary Fund.

[SEOUL] The South Korean won fell against the dollar on Wednesday in reaction to a cautious mood after Greece became the first developed economy to default on a loan with the International Monetary Fund.

The South Korean won was down 0.4 per cent at 1,120.0 per dollar as of 0232 GMT from the previous close at 1,115.5.

Analysts said the won's decline would be limited by local exporters' demand for month-end settlements.

"Demand from domestic exporters continued around 1,120 level," said Yuna Park, a foreign-exchange analyst at Dongbu Securities.

Besides the Greece saga, investors were also keeping an eye on key US jobs data later this week. A Reuters poll forecast payroll gains of 230,000. "Market expects the data will be strong," Ms Park said.

Seoul shares rose as investors picked up bargains following a selloff on Monday, when the market slumped 1.4 per cent - the biggest drop in a month.

The Korea Composite Stock Price Index (KOSPI) was up 0.8 per cent at 2,091.25 points, building on Tuesday's 0.7 per cent bounce. Winning shares outnumbered losers by around 2 to 1.

Kim Yoon-seo, an analyst at KTB Investment & Securities, said the market may have oversold on the Greek worries.

However, "trading volumes are lukewarm today, so it's not meaningful rebound. Domestic funds are focused on mid and small-caps ahead of earning season," Ms Kim added.

Samsung C&T Corp and Cheil Industries Inc pared their gains a touch, after a South Korea court denied US fund Elliott's injunction request seeking to block a shareholder vote on a proposed US$8 billion merger between the two companies.

Market heavyweight Samsung Electronics Co Ltd gained 1.5 per cent.

Daum Kakao Corp rose 8.8 per cent after soaring as much as 10.6 per cent to over four-month highs in early trading. The messaging app operator launched new content and search services on Tuesday, within the top chat app in South Korea.

September futures on three-year treasury bonds were down 0.05 point to 109.01.

REUTERS