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Seoul: Won firms to 1-1/2 wk high as US dollar loses steam, stocks edge up

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The South Korean won firmed on Monday as the strong US dollar lost traction ahead of major global events this week that could increase uncertainty in financial markets worldwide.

[SEOUL] The South Korean won firmed on Monday as the strong US dollar lost traction ahead of major global events this week that could increase uncertainty in financial markets worldwide.

The won was up 0.7 per cent against the US dollar as of 0201 GMT, compared to last Friday's onshore close of 1,177.4.

It briefly touched 1,168.9 before midday, its highest since Nov 17.

"Traders as well as local exporters will keep the US dollar's gains in check this week, lifting the won, but the local currency's gains are likely to be short-lived," said Jeon Seung Ji, a foreign exchange analyst at Samsung Futures.

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Mr Jeon said the won was likely to face pressure again ahead of a meeting by the Organisation of the Petroleum Exporting Countries (Opec) on Nov 30.

A domestic referendum on constitutional reform is scheduled for Dec 4, even as President Park Geun Hye fights for her political survival in a corruption scandal.

Any uncertainty from those events would send the won, a risky asset, down or keep gains limited, she added.

South Korean shares were nearly flat on Monday, as market players kept a cautious stance ahead of the Opec meeting, according to analysts. Oil prices have slumped on worries that the cartel will not be able to agree on output cuts.

The Korea Composite Stock Price Index (Kospi) was up 0.2 per cent at 1,977.46 points.

Shares in Samsung C&T, the de facto holding company of Samsung Group were up 5.6 per cent after a local media report said Samsung Electronics was considering splitting itself into two in response to a proposal made by activist shareholder Elliott Management.

Samsung Electronics' shares were nearly flat, trading up 0.2 per cent around midday.

Foreigners and institutions were sellers in early trade, unloading 15.7 billion won (S$19.17 million) and 34 billion won worth of shares, respectively. Retail investors snapped up a 44.6 billion won worth to offset their sales.

December futures on three-year treasury bonds added 0.15 points to trade at 109.20.

REUTERS

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