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Seoul: Stocks rise slightly amid caution on trade talks; won up 1.2%

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[SEOUL] South Korea's Kospi index edged up on Thursday, shrugging off the US Federal Reserve's dovish signal, as investors remained cautious ahead of the G-20 summit that is expected to witness trade talks between the United States and China. The Korean won rose more than 1 per cent against the dollar, while the benchmark bond yield fell sharply.

The Seoul stock market's main KOSPI ended up 6.51 points or 0.31 per cent at 2,131.29.

Though the Fed indicated a rate cut, the major index did not gain much as wait-and-watch mood was strong among investors ahead of the G-20 summit, said Ha In-hwan, an analyst at Meritz Securities. The index's movement would be limited before the event, he added.

The lingering trade tensions between the world's top two economies have roiled global financial markets. Talks between the two parties to strike a deal fell apart last month and investors have waited for the meeting between U.S. President Donald Trump and Chinese counterpart Xi Jinping later this month.

The Fed said it was ready to battle growing global and domestic economic risks with interest rate cuts beginning as early as next month, as it took stock of rising trade tensions and growing concerns about weak inflation.

Shares of LG Display closed up 7 per cent after local media, citing market research data, reported that the company took the first place by shipment in global automotive display market in the first quarter.

Foreigners were net sellers of 13.8 billion won ($11.88 million) worth of shares on the main board.

The won was quoted at 1,162.1 per dollar on the onshore settlement platform, 1.20 per cent higher than its previous close at 1,176.1. The currency marked its highest close since April 29.

In offshore trading, the won was quoted at 1,161.6 per U.S. dollar, up 0.9 per cent from the previous day, while in non-deliverable forward trading, its one-month contract was quoted at 1,160.4 per dollar.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 1.08 per cent, after U.S. stocks edged up . Japanese stocks rose 0.60 per cent.

The KOSPI has risen 4.42 per cent so far this year, but lost 2.4 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 996.21 million shares and, of the total traded issues of 891, the number of advancing shares was 540.

The won has lost 4.0 per cent against the US dollar so far this year.

In money and debt markets, September futures on three-year treasury bonds rose 0.18 points to 110.63, while the three-month Certificate of Deposit rate was quoted at 1.80 per cent.

The most liquid three-year Korean treasury bond yield fell by 6.2 basis points to 1.424 per cent, marking its lowest since November 2016. The benchmark 10-year yield fell by 5.8 basis points to 1.544 per cent, hovering around its lowest since October 2016.