Seoul: Shares, won climb as investors cheer credit support measures

South Korean shares and won strengthened on Monday (Oct 24) as investors found some relief in the government's credit support measures to ease worries about a credit crunch in bond and short-term money markets. The benchmark bond yield fell.

The benchmark Kospi rose 29.69 points, or 1.34 per cent, to 2,242.81, as at 0210 GMT.

Among heavyweights, technology giant Samsung Electronics rose 2.50 per cent and peer SK Hynix gained 1.88 per cent, while battery maker LG Energy Solution advanced 1.40 per cent.

The government will double the ceiling of its corporate bond-buying facility run by state-run banks to 16 trillion won (S$15.8 billion), Minister of Economy and Finance Choo Kyung-ho said on Sunday. Investors found comfort in the government's measures to ease worries about a possible credit crunch, while expectations about a slowdown in the US Federal Reserve's policy tightening pace also lifted sentiment, said Na Jeong-hwan, an analyst at Cape Investment & Securities.

Some Fed officials have begun sounding out their desire to slow down the pace of rate hikes soon, according to a Wall Street Journal report.

The trading volume during the session in the Kospi index was 229.01 million shares. Of the total traded issues of 931, the number of advancing shares was 775.

Foreigners were net buyers of shares worth 16.8 billion won on the mainboard.

The won was quoted at 1,434.7 per dollar on the onshore settlement platform, 0.36 per cent higher than its previous close at 1,439.8.

The Kospi lost 24.68 per cent so far this year, and dropped 7.9 per cent in the previous 30 trading sessions.

The won weakened 17.1 per cent against the dollar so far this year.

In money and debt markets, December futures on three-year treasury bonds rose 0.40 point to 101.55.

The most liquid three-year Korean treasury bond yield dropped 18.1 basis points to 4.314 per cent, while the benchmark 10-year yield fell by 15.3 basis points to 4.502 per cent. REUTERS

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