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Seoul: Stocks rise as investors shrug off latest trade worries

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[SEOUL] South Korean shares closed higher on Monday on better-than-expected China data and as investors shrugged off news that Washington was considering delisting Chinese companies from US stock exchanges. The South Korean won and the benchmark bond yield rose.

President Donald Trump's administration is considering delisting Chinese companies from US stock exchanges, three sources briefed on the matter said on Friday, in what would be a radical escalation of US-China trade tensions.

It seems like investors saw the news from the United States as a tactic to hold a dominant position in the trade talks with China (rather than a real threat), said Ryoo Yong-seok, an analyst at KB Securities.

China's September factory activity survey, slightly higher than market consensus, was also positive for domestic markets, Ryoo added.

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Shares of Samsung Electronics closed up 1.34 per cent after the company said it has secured a deal to provide 5G equipment for Japan's KDDI.

As a demand for 5G mobile network increases, Samsung Electronics is expected to win more orders, particularly with its rival Huawei Technologies under pressure of U.S. sanctions, said Lee Chang-min, an analyst at KB Securities.

The Seoul stock market's main Kospi ended up 13.12 points, or 0.64 per cent, at 2,063.05.

The benchmark index gained 4.84 per cent for the month, erasing some of its losses in July and August. However, the index shrank 3.17 per cent on a quarterly basis, posting a second consecutive quarter of losses.

Foreigners were net buyers of one billion won worth of shares on the main board on Monday.

The won was quoted at 1,196.2 per dollar on the onshore settlement platform, 0.31 per cent higher than its previous close at 1,199.9.

The currency gained 1.25 per cent from a month ago, but extended its losses to a fourth straight quarter with a 3.47 per cent drop during July-September period.

In offshore trading, the won was quoted at 1,196.7 per US dollar, up 0.4 per cent from the previous day, while in non-deliverable forward trading its one-month contract was quoted at 1,195.6 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.02 per cent, after US stocks declined on Friday. Japanese stocks fell 0.56 per cent.

The Kospi has risen 1.08 per cent so far this year, and gained 6.4 per cent in the previous 30 trading sessions.

The trading volume during the session in the Kospi index was 318.65 million shares and, of the total traded issues of 890, the number of advancing shares was 349.

The won has lost 6.7 per cent against the dollar so far this year.

In money and debt markets, December futures on three-year treasury bonds rose 0.02 point to 110.84, while the 3-month Certificate of Deposit rate was quoted at 1.55 per cent.

The most liquid three-year Korean treasury bond yield fell by 1.2 basis points to 1.289 per cent, while the benchmark 10-year yield rose by 0.1 basis points to 1.440 per cent.

REUTERS