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Seoul: Stocks close lower on expiring options, weak China data

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[SEOUL] South Korea's Kospi stock index closed lower on Thursday around the expiration of options contracts, while China's weak inflation data stoked concerns over economic slowdown amid hopes for a trade deal between the world's two biggest economies. The Korean won gained, while bond yields fell.

China's producer prices in December rose at their slowest pace in more than two years, a worrying sign of deflationary risks that could see Beijing roll out more policy support to help stabilise the economy.

At 0633 GMT, the Kospi closed down 1.43 points or 0.07 per cent at 2,063.28.

Investors kept a wait-and-see stance ahead of Federal Reserve chairman Jerome Powell's speech tonight, said Seo Sang-young, an analyst at Kiwoom Securities.

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A multi-day rally in risk assets continued overnight after minutes from the Fed's December meeting showed a range of Fed policymakers said last month they could be patient about future interest rate increases and a few did not support the central bank's rate increase that month.

The won was quoted at 1,118.3 per dollar on the onshore settlement platform, 0.34 per cent firmer than its previous close at 1,122.1, extending its gain to a second session.

In offshore trading, the won was quoted at 1,118.61 per U.S. dollar, down 0.13 per cent from the previous session, while in one-year non-deliverable forwards it was being asked at 1,102.05 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.18 per cent, after US stocks ended the previous session with gains. Japanese stocks weakened 1.29 per cent.

The current price-to-earnings ratio is 12.10, the dividend yield is 1.28 per cent and the market capitalisation is 1,242.04 trillion won.

The trading volume during the session on the Kospi index was 375,681,000 shares and, of the total traded issues of 896, the number of advancing shares was 330.

Foreigners were net buyers of 273,778 million won worth of shares.

The won's high for the year is 1,114.7 per dollar on Jan 2, 2019 and low is 1,130.05 on Jan 3, 2019.

In money and debt markets, March futures on three-year treasury bonds rose 0.05 points to 109.28.

The Korean three-month Certificate of Deposit benchmark rate was quoted at 1.86 per cent, while the benchmark three-year Korean treasury bond yielded 1.801 per cent, lower than the previous day's 1.81 per cent.

REUTERS