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Seoul: Stocks rebound on revived trade optimism; won dips

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[SEOUL] South Korea's Kospi stock index rebounded to end higher on Tuesday as slightly more optimistic comments from Washington and Beijing over trade negotiations lifted sentiment. The South Korean won inched lower and the benchmark bond yields also dropped.

Chinese government's top diplomat said on Tuesday China and the United States both have the "ability and wisdom" to reach a trade deal that is good for both. China's State Councillor Wang Yi said the talks are not a one-way street and should be based on equality.

The remarks from China comes after US President Donald Trump said earlier on Tuesday that he was optimistic about resolving the trade dispute with China, adding that he has "a feeling it's going to be very successful".

The Seoul stock market's main Kospi ended up 2.83 points, or 0.14 per cent, at 2,081.84 points.

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Foreigners were net sellers of 285.2 billion won worth of shares on the main board.

The won was quoted at 1,189.4 per dollar on the onshore settlement platform, 0.16 per cent lower than its previous close of 1,187.5, marking the fourth fall in the past five sessions.

Amid won's weakness in the currency market, South Korea's finance minister said on Tuesday policy efforts are focused on monitoring and containing risks from increased FX volatility and US-China trade dispute, adding that the ministry will hold policy meetings this week and next to deal with currency and trade risks.

In offshore trading, the won was quoted at 1,188.9 per US dollar, down 0.1 per cent from the previous session, while in one-year non-deliverable forward trading its one-month contract was quoted at 1,187.5 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was down 1.09 per cent, in line with the overnight declines in Wall Street. Japanese stocks dropped 0.59 per cent.

The Kospi climbed 2 per cent so far this year, and dropped 2.3 per cent in the previous 30 trading sessions.

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 688.58 million shares and, of the total traded issues of 891, the number of advancing shares was 488.

The won lost 6.2 per cent against the US dollar so far this year.

In money and debt markets, June futures on three-year treasury bonds rose 0.05 point to 109.56, while the three-month Certificate of Deposit rate was quoted at 1.84 per cent.

The most liquid three-year Korean treasury bond yield dipped 0.8 basis point to 1.713 per cent, while the benchmark 10-year yield fell by 0.4 basis point to 1.870 per cent.

REUTERS