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Seoul: Stocks edge higher on hopes of Fed easing rate hikes in 2019

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[SEOUL] South Korea's Kospi stock index ended slightly higher on Monday on hopes of the US Federal Reserve easing rate hikes next year. The South Korean won inched down, while bond yields rose.

At 0631 GMT, the Kospi was up 1.70 points, or 0.08 per cent, at 2,071.08.

Most Asian shares ended positive in expectations of US monetary policy changes, though economic indexes from China and Europe are stagnant, said Park Sang-hyun, an economist at Leading Investment & Securities.

Investors are eager for a touch of Christmas cheer from the U.S. Federal Reserve at its meeting this week, hoping for signs the central bank may ease up on interest rate hikes next year and spark a Santa Claus rally.

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South Korea cut its 2018-2019 growth outlook to the lowest in six years, citing weak investment and global trade tensions. The finance ministry viewed the economy is expected to grow by 2.6 to 2.7 per cent this and next year.

The won was quoted at 1,131.3 per dollar on the onshore settlement platform, 0.04 per cent weaker than its previous close at 1,130.8.

In offshore trading, the won was quoted at 1,131.1 per US dollar, up 0.05 per cent from the previous day, while in one-year non-deliverable forwards it was being transacted at 1,110.85 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.24 per cent, after US stocks ended the previous session with mild losses. Japanese stocks rose 0.62 per cent.

The Kospi is down around 16.1 per cent so far this year, and up by 1.27 per cent in the previous 30 days.

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 438,201,000 shares and, of the total traded issues of 893, the number of advancing shares was 363. Foreigners were net buyers of 48,591 million won worth of shares.

The US dollar has risen 6.07 per cent against the won this year. The won's high for the year is 1,053.55 per dollar on April 2, 2018 and low is 1,146.26 on Oct 11, 2018.

In money and debt markets, December futures on three-year treasury bonds fell 0.02 points to 109.17. The South Korean three-month Certificate of Deposit benchmark rate was quoted at 1.9 per cent, while the benchmark three-year Korean treasury bond yielded 1.793 per cent, higher than the previous day's 1.78 per cent.

REUTERS